Political impasse sends Zimbabwe dollar tumbling

BULAWAYO -
Zimbabwe's battered currency has plunged to new record lows days after
President Robert Mugabe and Prime Minister-designate Morgan Tsvangirai
failed to break a deadlock over the allocation of key Cabinet
ministries.

The Zimbabwe dollar shaved off more than half its value
within two days as the political stalemate between the country's bitter
rivals took its toll on the shattered economy, immediately driving the cost
of basic goods and services beyond reach of inflation-weary
Zimbabweans.

Traders were on Thursday exchanging ZW$1 000 000 for a one
United States dollar when using the bank transfer rate, Real Time Gross
Settlement (RTGS), up from Tuesday's figure of ZW$500 000 to one greenback
when Mugabe and Tsvangirai failed to agree on the allocation of ministries
in a new government of national unity.

On the black market, US$1 was
fetching ZW$4 000, up from Tuesday's figure of $2 000. One US dollar fetches
$140 in the bank.

Zimbabwe has at least three exchange rates with the
bulk of foreign currency traded on the illegal black market and using the
RTGS, which is official but has been hijacked by illegal traders who
manipulate the special system to achieve higher returns than are possible on
the normal official market.

Analysts said the weakening of the local
dollar is driven by inflation expectations, wild speculation and uncertainty
over the future of a power-sharing deal that was signed on September
15.

"The weakening of the currency will continue to be driven by
speculation and uncertainty since the market continues to wander in the
wilderness in the absence of a (unity) government to formulate economic
policies to reign in inflation," said John Robertson, an economic
analyst.

Shops, when they have commodities, peg their prices using the
RTGS rate, which is way beyond what average Zimbabweans earn.

A
stalemate between Mugabe and Tsvangirai over the allocation of Cabinet posts
has been referred back to former South African President Thabo Mbeki, the
mediator of the power-sharing deal. But ZANU PF party says there is no need
to involve Mbeki, raising doubts whether Mugabe's party will cooperate with
the ex-South African president.

The deal, signed by Mugabe, Tsvangirai
and Arthur Mutambara, a rebel leader of the opposition Movement for
Democratic Change (MDC) party, is seen as the first real step in ending a
decade long economic and political crisis in the southern African
state.

Zimbabwe has been without balance of payment support since 1999
after a policy fallout with multilateral financiers and black market traders
said on Thursday high demand for foreign currency continued to push up rates
on the flourishing parallel market.

"Demand (for foreign currency) is
very high and there is also shortage of Zimbabwe dollar notes. This is why
you see (parallel market) rates going up and the Zimbabwe dollar losing
value," a trader at a popular spot along Julius Nyerere Avenue in central
Harare said.

"As long as there is no finality on this Cabinet issue it
will be business as usual. We don't think the current government will have a
new economic policy," the trader, who identified himself only as Sam, said
in the local Shona language.

Zimbabwe has grappled with nearly a
decade of a punishing economic recession, which the World Bank says is the
worst for a country not at war.

Hyper-inflation is officially cruising
above 11 million percent, but independent analysts say it is as high as 40
million percent, which has impoverished a population already hit by
shortages of cash, foreign currency, food and crumbling social
services.

United Nations Secretary General Ban-ki Moon said this week
Zimbabwe could need humanitarian assistance for the next coming years after
the collapse of its agriculture sector, the backbone of the once promising
economy.

Critics say Mugabe, who has ruled the country since independence
in 1980 and who was re-elected in a one-man race in June after a terror
campaign against the opposition, has run down the once breadbasket of Africa
with ruinous policies such as his expulsion of experienced white farmers and
replacing them with either incompetent or inadequately funded black
farmers.

Food production as plunged since Mugabe's controversial land
reforms that began in 2000 and Zimbabwe has avoided starvation only because
international relief agencies have been quick to chip in with food
handouts.

Mugabe denies ruining Zimbabwe and blames hunger in the country
on erratic rains and Western sanctions he says have hampered importation of
fertilizers, seed, and other farming inputs. - ZimOnline

MDC high level meeting postponed

HARARE - Zimbabwe's opposition MDC party
yesterday called off a meeting of its decision making national executive
council that sources had said was set to decide whether the party should
pull out of a power-sharing agreement with President Robert Mugabe's ruling
ZANU PF party.

The agreement signed by Mugabe, MDC leader Morgan
Tsvangirai and Arthur Mutambara, who leads a smaller faction of the
opposition, looked increasingly in danger of collapsing this week after
direct talks between Mugabe and Tsvangirai on Tuesday failed to break a
deadlock on the formation of a government of national unity.

MDC
spokesman Nelson Chamisa confirmed postponement of the national council
meeting but declined to say why it was called off or to say what was on the
agenda of the cancelled meeting.

Chamisa said: "It (meeting) was
indeed set for today (Thursday) but has been postponed
indefinitely."

Asked whether the meeting had been cancelled because there
had been positive movement on the deadlock with ZANU PF over sharing of
Cabinet posts, Chamisa said: "There has been no movement. We are still in
the same position we were yesterday (Wednesday)."

The power-sharing
agreement that was brokered by ex-South African president Thabo Mbeki 15
Cabinet posts to ZANU PF, 13 to the Tsvangirai-led MDC and 3 to the
Mutambara-led MDC. The deal is silent on which specific posts should go to
which party.

The MDC has accused Mugabe of seeking to control all key
Cabinet posts while relegating the opposition party to a junior role in the
unity government.

Following the failure of Mugabe and Tsvangirai to break
the deadlock over Cabinet posts, the MDC called on Mbeki to resume mediation
while it also said the Southern African Development Community (SADC) and the
Africa Union (AU), guarantors to Mbeki's mediation, should also
intervene.

But ZANU PF insists there is no need for outside intervention
with the party's chief negotiator, Patrick Chinamasa, saying yesterday that
anyone claiming there was a deadlock over Cabinet posts was not well
informed about power-sharing talks.

Chinamasa said: "I don't know of
any deadlock and those talking about it I am told are not privy to what is
going on in the negotiations."

He reiterated that as far as he and ZANU
PF were concerned there was no need to recall Mbeki to help with the
allocation of government jobs. "This is a small matter which can be
resolved," he said.

Mutambara, who arrived in Harare on Wednesday after
days in China, was reportedly scheduled to meet Mugabe. But he refused to
take questions on the matter when phoned by ZimOnline.

The
power-sharing agreement is widely seen as providing the best opportunity yet
for Zimbabwe to begin work to end an acute recession that is seen in the
world's highest inflation of 11 million percent, deepening poverty amid
shortages of food and every basic survival commodity.

The
international community, in particular Western donor nations whose financial
support is vital to any effort to resuscitate Zimbabwe's comatose economy,
has to help rebuild the country but only after assessing implementation of
the power-sharing deal. - ZimOnline

Movement Seen Toward Resolution Of Zimbabwe Cabinet
Crisis

VOA

By Ntungamili NkomoWashington02 October
2008

Negotiators for Zimbabwe's ZANU-PF and Movement for
Democratic Change parties held lengthy consultations by telephone on
Thursday in an effort to break a deadlock over the composition of the
cabinet for the unity government the parties agreed to last month, sources
close to the discussions said.A well-informed source in President Robert
Mugabe's ZANU-PF told VOA that the party has moved toward a resolution of
the apparent stalemate by ceding the Ministry of Finance to the MDC
formation of Morgan Tsvangirai, designated as prime minister.

The
source said Mr. Mugabe met top ZANU-PF officials today, among them party
strategist Emmerson Mnangagwa, otherwise rural housing minister, and Patrick
Chinamasa, currently minister of justice, and agreed to concede the finance
portfolio.

The source could not shed light on the disposition of
other major portfolios, such as home affairs, foreign affairs, agriculture
and information.

Spokesman Nelson Chamisa of the Tsvangirai MDC
formation said he had no information as to a concession by ZANU-PF on the
critical finance post. Most observers have concluded that the ministry must
end up in MDC hands or international donors will be reluctant to bring to
the country the billions of dollars required to launch economic
reconstruction.

Chamisa confirmed, however, that a meeting of the
Tsvangirai MDC national executive set for Thursday had been postponed.
Sources said the meeting had been called to decide whether the party should
pull out of the power-sharing process due to Mr. Mugabe's failure to name a
cabinet in which the key posts are equitably distributed.

The
state-controlled Herald newspaper quoted Chinamasa, ZANU-PF's chief
negotiator, as saying offices in the Monomotapa government building were
ready for Tsvangirai.

Political analyst George Mkwananzi told
reporter Ntungamili Nkomo of VOA's Studio 7 for Zimbabwe that the statement
from Chinamasa suggested that ZANU-PF is concerned that the hard-won
agreement for a national unity government might unravel

Mugabe-Mutambara
alliance in offing

HARARE (The
Zimbabwean/Own Correspondent) - Under pressure from the security chiefs to
renege on the power-sharing deal signed last month, President Robert Mugabe
has offered cabinet posts to key officials of the Arthur Mutambara faction
of the MDC.

Highly placed sources say such a deal is being struck behind
the back of the mainstream MDC led by Prime Minister-designate Morgan
Tsvangirai. It is an open secret that Mutambara and his faction were the
favourites of negotiation mediator, Thabo Mbeki, who fell from power in
South Africa as the power sharing deal was being signed in
Harare.

For long there have been open lines of communication between
Mbeki and Mutambara's secretay general Welshman Ncube, who engineered the
withdrawal of his faction from the mainstream MDC in 2005.

A highly
placed source within Zanu-PF says that upon his return from New York on
Monday, Mugabe was told by the heads of the Zimbabwe Defense Forces, the
Police and the Air Force that two options were open to him. He either had
to renege on the agreement to share key ministries with the MDC or risk
being forcibly removed from office.

There is a widely held perception
that the security chiefs, the so-called Joint Operations Command,
effectively usurped executive power from Mugabe soon after his defeat at the
polls by Tsvangirai on March 29. It is they, it is reported, who
orchestrated the seven week delay in the announcement of the result of the
presidential election and the subsequent scourge of violence during the
run-up to the second presidential election on June 27.

"Mugabe is
determined to remain as President of Zimbabwe until the day he dies, but he
knows that if he ignores the threats from the generals, that day could come
a lot sooner than he thinks", the Zanu-PF source said.

Aware that the
Tsvangirai MDC would have no option but to reject the minor ministries
offered to it, Mugabe is expected to proceed with the formation of a cabinet
of his own.

In the new cabinet key Mugabe ally, Emmerson Mnangagwa will
become the Minister of Home Affairs, while the architect of Zimbabwe's
economic collapse, Reserve Bank Governor, Gideon Gono, will become Minister
of Finance.

To provide the necessary window dressing to placate
regional unease over this move, Mugabe has reportedly enticed the leaders of
the MDC faction led by Arthur Mutambara with positions in the new
cabinet.

It is understood that the Mutambara MDC secretary general, Ncube
will be allocated the Ministry of Trade and Industry, while Priscilla
Misihairambwi Mushonga will become the Minister of Communications and Moses
Mzila-Ndlovu will become the new Minister of National Integration, Sport and
Culture.

The Zimbabwe Times submitted questions to Mutambara asking him
to comment on these allegations. At the time of publishing he had not
responded.

Commenting on this development, a mainstream MDC spokesperson
said this development showed that the leadership of the Mutambara faction of
the MDC was not interested in alleviating the suffering of the people but
were instead focused on lining their own pockets.

"You can predict
what will happen when these people climb into bed with the same people who
have raped our county and who have no desire to admit to, or address, the
problems the people are facing" the spokesperson said.

"While this deal
will worsen the situation in the country it will serve to strengthen the
resolve of the people and the MDC to finding a lasting solution to the
Zimbabwe crisis", he added.

Millions of ordinary Zimbabweans are facing
starvation as the new crop planting season approaches against a backdrop of
a serious shortage seed, fertiliser and other farming inputs. The economy is
in free fall with the ZImbabwe currency now pegged at Z$1 000 000.00 to
US$1.00 only months after the government removed 10 zeroes from the
currency. Inflation now stands at almost 200 million percent.

Public
rejects poor quality new $20 000 note

HARARE - Reserve Bank Governor Gideon Gono's money
printing project suffered a major setback as Zimbabweans reacted negatively
to the new $20 000 dollar note introduced only six days ago.

There
appears to be a general rejection of the new in preference to the $10 000
note introduced at the same time but which is printed on imported
paper.

Some retailers are also refusing to recognise the new $20 000
note.

Zimbabwean banks have operated under siege since Monday as
thousands of cash-strapped depositors have tried in vain to withdraw funds
after Gono announced on that day an increase in the cash withdrawal limit
from $1 000 to $20 000.

However, people were disappointed to find the
largest denomination printed on what appears to be cheap paper.

The
note does not have a security thread or watermark, leaving people unable to
distinguish fake notes from genuine ones, amid fears that fake notes may
have already flooded the market. Experts say fraudsters can easily reproduce
copies of the $20 000 notes.

Gono this week vowed to continue to
print new notes as long as "illegal sanctions imposed by the West remain in
place." He was repeating President Robert Mugabe's mantra that Zimbabwe's
problems have resulted from sanctions allegedly by Western
countries.

However, British foreign secretary, David Miliband last week
blamed Mugabe for Zimbabwe woes. He said the Zimbabwean strongman had simply
mismanaged the economy, and was now looking for scapegoats.

"I am not
afraid of printing money and I will continue doing so until those who
imposed sanctions on us lift them," Gono told peasant farmers at a field day
at Mushandike Irrigation Scheme in Masvingo last Friday.

Economists have,
however, cautioned Gono - albeit without success - that printing money fuels
inflation, which is Zimbabwe's most serious problem at the
moment.

Independent economists now estimate Zimbabwe's inflation rate at
55 million percent although government says the figure is five times lower
at 11, 2 million percent.

The poor quality of the newly-introduced
$20 000 could be attributed to a decision by Giesecke & Devrient, a
German company, this year, to pull out of its contract to supply Zimbabwe
with paper to print notes.

The move by the company followed international
criticism that the firm was an accessory to human rights abuses in Zimbabwe.
Critics said the money printed on the German company's paper was being used
to fund terror campaigns against President Robert Mugabe's
opponents.

While German Chancellor Angela Merkel, had initially said
Giesecke & Devrient's contract was a private matter, Frank-Walter
Steinmeier, the German foreign minister, later ordered the company to halt
deliveries of the paper to Zimbabwe.

On his return from the 63rd
session of the UN in New York, President Mugabe lashed out at critics of his
government's decision to print more money, saying the Americans were doing
the same.

He was referring to plans by the US government to bail out
financially- stressed mortgage banks to the tune of US$700 billion. Mugabe
said the Americans were going to print the money but only preferred to
describe their own actions as "a rescue package."

Reserve
Bank suspends use of RTGS

HARARE - The Reserve Bank of Zimbabwe has with immediate
effect suspended the use of Real Time Gross Settlement (RTGS) as a form of
payment following the abuse of the system by speculators.

Gideon
Gono, governor of the central bank, said the system had become an active
vehicle for illicit foreign currency dealings on the parallel market as well
as a convenient excuse by sellers of goods to overprice their commodities,
thus inconveniencing the less privileged.

"The use of the RTGS system for
customer payments is hereby suspended until further notice," said Gono in a
statement.

"For the avoidance of doubt there will be no processing of the
RTGS payments through the system with effect from Friday October
3."

Gono said the design of the RTGS system was such that payments and
inter-account transfers must reflect in the recipients' account a few
minutes after effecting the payment, but the system was now being
abused

"The victims have largely remained the defenceless members of
public who have to watch in despair as their hard earned incomes are grabbed
away from them through the extractive pricing structure," said
Gono.

Gono said cognisant of the need to provide liquidity to facilitate
settlement of clearing house obligations by financial institutions, all
payments from the Reserve Bank to financial institutions and vice versa
would continue to be credited to their accounts electronically. These
include funding by banks for cash withdrawals.

"RTGS systems are by
nature designed to handle high value high risk payments. They enable instant
transfer of funds from one bank to another," said Gono.

Gono said
when complemented with straight through processing (STP), they facilitated
real-time end-to-end processing of payments between customers of different
banks

"A major advantage of RTGS systems is that they provide final and
irrevocable settlement through accounts at the central bank, thereby
reducing credit risk," said Gono

The bank was compiling RTGS
promptness profile for each bank and would suspend up to six months banks
which were found guilty of delaying the process.

"Accordingly,
therefore, the Reserve Bank will with immediate effect be compiling customer
RTGSs' service promptness profiles for each bank," said Gono.

"When a
bank is seen to be delaying the processing of customer payments it will be
promptly suspended from using the RTGS platform for a minimum for 6 months
or longer, depending on the severity of the ill-practices."

Gono said the
public should come with documented examples of undue delays by banks in
processing their RTGS instructions so that swift remedial action is
taken.

"Retailers wholesalers, producers and other services providers
must therefore take RTGS payments as good as cash and help the economy
stabilization prospects by avoiding the predatory pricing structure
currently prevailing in multiplicities," said Gono

Public
not warned of new cholera outbreak

HARARE - The public has not been made aware of a new
cholera epidemic that has plagued Harare and Chitungwiza since September and
claimed 18 lives, with 80 admitted to hospital as of Thursday.

Human
rights lawyers in Zimbabwe have slammed the authorities, holding them liable
for the "alarming and quite unusual deaths" from a preventable
disease.

The Zimbabwe Lawyers for Human Rights accused the government
of criminal negligence saying the deaths were a result of unacceptable
failure of leadership.

Hospital officials said the death toll had
zoomed up Thursday and that they were battling to contain the outbreak amid
fears it could degenerate into an unmitigated epidemic.

"We have so
far registered a total of 14 deaths here with four other deaths reported in
Harare and 77 cases of the disease reported," Dr Obadiah Moyo, chief
executive officer of the Chitungwiza Central Hospital in the satellite town
just outside the capital Harare, told The Zimbabwe Times.

About 12 people
had been reported dead by September 30 and two more succumbed to the disease
over the past two days.

Chitungwiza Central Hospital, in the populous
town, is now coordinating an anti-cholera program in the town, home to
almost a million people. The latest deaths have been recorded in Unit O,
which has been cut off from water supplies over the past one month
now.

Other parts of the town are facing intermittent water supplies.
Authorities say the water shortages are a result of power outages that have
affected the pumping of water from the main supply source, Morton Jaffray
Works, which supplies the bulk of the water for both domestic and industrial
use.

There are currently 77 cholera patients, including 30 children under
the age of five, being cared for in the hospital, Moyo said.

"Between
Monday and Tuesday we received 30 patients," he said. "We are really snowed
under and the patients keep coming."

He said the patients had been
quarantined and treated in the disinfecting basin at the Chitungwiza
clinic.

Cholera is caused by intestinal bacteria that trigger serious
diarrhoea and vomiting leading to dehydration. The disease is mainly caused
by poor sanitation. With a short incubation period, it can be fatal if not
treated within 24 hours.

Experts say the number of people infected
with cholera could be much higher than the cases officially reported. The
Zimbabwe Doctors for Human Rights said in a statement the official cholera
deaths were grossly underestimated.

"This is but the tip of an iceberg of
much more morbidity," said the human rights doctors. "This has not been
communicated to the public."

Some of the infected people hide from health
officials, according to local health authorities in the Chitungwiza
neighbourhood, which has been seriously affected by the
epidemic.

"There are a lot of taboos surrounding the illness," said
Miriam Maposa who works at a local health clinic. "Parents do not want to
tell the health officials of cases of infections in their families because
of the stigma associated with poor sanitation in the homes."

The last
cholera epidemic in Mabvuku in Harare killed four people and infected at
least four people in March, mainly because of shortages of water.

A
resident of Unit O, in the Seke section of Chitungwiza, Nyasha Muzambi, who
lost his brother to cholera five days before he was to get married, said:
"His bride is devastated and we are taking legal action. We can't allow this
to just go unchallenged.

"We owe it to his young wife who has been
widowed because of a preventable disease. It's just unacceptable."

Zimbabwe's MDC Weighs Action Against Alleged Rogue Mayor

Sources
in Masvingo, southeast Zimbabwe, said the Movement for Democratic Change
formation of Morgan Tsvangirai might expel Masvingo Mayor Femias Chakabuda
from the party or force him to resign amid charges he defected to the former
ruling ZANU-PF party as political violence raged in the approach to June's
presidential run-off election.

Chakabuda denied the allegations in an
interview with VOA.

The MDC sources said Chakabuda and two other
councilors were found guilty of misconduct by a party commission which
completed a probe this week.

The secretary of that panel, Lawson
Mapfaira, confirmed to VOA that the commission was investigating Chakabuda
and councilors Daniel Muchuchutu and Selina Maridza.

Mapfaira added
that the panel was scheduled to meet with the three councilors Thursday
evening, but declined to comment further. MDC Masvingo Provincial Chairman
Wilstaff Chitemere also declined to comment on the matter to VOA.

In
an interview, Chakabuda dismissed the allegations as malicious and unfair to
the MDC as well as himself, telling reporter Jonga Kandemiiri of VOA's
Studio 7 for Zimbabwe that he never shifted his political loyalties to
ZANU-PF or attended any of its meetings.

Production
at Falcon Gold plummets as hyperinflation, power outages and shortages of
materials take toll

By: Oscar NkalaPublished on 3rd October
2008Updated 2 hours 39 minutes agoFalcon Gold Zimbabwe produced a mere
85 kg of gold between January and June this year, compared with 291 kg
during the first half of last year.Chairperson G Hunter says the severe drop
was caused by a crippling mix of negative factors carried over from the
previous year.

"The group continued to operate in an environment
characterised by relentlessly high inflation, serious currency depreciation,
increasing input shortages, incessant power outages and surging skills
emigration," Hunter says.

He states that a power supply deal under
which gold-mining companies pay for power in foreign currency has not saved
the group, as outages are still being experienced, adversely affecting
operations.

"While this started off well, the Reserve Bank of Zimbabwe
(RBZ) has been unable to meet its commitments with respect to the agreement
and power outages have ensued, further affecting
productivion."

Hunter says that apart from power cuts, the much-lowered
gold production is "due to inefficiencies caused by the unavailability of
essential stores and the difficult operating and economic
environment".

He says very limited exploration was undertaken in the
period under review.The company operates the Dalny, Venice, Golden Quarry
and Camperdown mines, in Zimbabwe, and Hunter says that it remains focused
on the troubled Southern African country.

However, he warns that the
continued operation of the mines will depend on the timely payment of what
the company is owed by the RBZ.

He calls for a regular review of the gold
support price, adding that the gold support price review undertaken in April
provided only a temporary respite.

"The flow of our funds from our
RBZ foreign currency account has also dried up as the foreign currency
situation worsens in the country. By the end of June 2008, gold proceeds
lodged with the RBZ represented a mere fraction of what would have been
received using a fair international gold price and exchange rate," Hunter
says.

Like many other mining companies, Falcon Gold is pinning its hopes
on the recently signed power sharing agreement, ushering in a new and
positive climate that will bring the economy back on its feet.

Zimbabwe:
battle between forces of change and continuity

Last updated: 10/03/2008
21:43:47IT IS hardly surprising that more than a fortnight after Zimbabwe's
much-celebrated Rainbow Agreement last month there is still tremendous
resistance to change, exemplified by the failure to agree on the formation
of a new Cabinet.

Change is a difficult thing to deal with. It is
hard to accept. We are creatures of habit and find more comfort in familiar
surroundings. Old timers at the workplace are more likely to say, "ndiwo
maitiro atagara tichiita zvinhu makore ese" (this is how things have always
been done), whenever the new, young manager tries to introduce
changes.

Part of it is that people do not know how to deal with change.
People prefer to stick to what they have always known because the
consequences are predictable. Anything new is likely to introduce
uncertainty and people do not like that.

Another part, however, is
that people do not wish to lose the privileges, however small, that they
have always enjoyed under the old order. This is aptly captured in a
Machiavelli quotation that I have previously employed in these pages.
Machiavelli said, in his most famous work, The Prince:

"It must be
considered that there is nothing more difficult to carry out, nor more
doubtful of success, nor more dangerous to handle, than to initiate a new
order of things. For the reformer has enemies in all those who profit by the
old order, and only lukewarm defenders in all those who would profit by the
new order . Thus it arises that on every opportunity for attacking the
reformer, his opponents do so with the zeal of partisans, the others only
defend him half-heartedly, so that between them he runs great
danger."

Zimbabwe is at that point where it is faced with possibilities
of change; where there is a chance 'to initiate a new order of things', to
use Machiavelli's words. It is important to recognise that the process of
change in Zimbabwe was always going to be a slow and painful process and is
not going to be a stroll in the park.We have to understand the critical
players in this process and how their response to change will ultimately
affect its success. These critical players are the people who can be
classified into, at least, three categories in relation to their attitude to
change:

First, there are 'change-agents', namely those at the forefront
of initiating and steering change. This category includes the majority of
the poor people who can be referred to as 'change-sceptics' - in that whilst
they badly want change, they have little facility to make it happen and
because they have outsourced it to politicians, they remain highly
sceptical.

Second, there are 'forces of continuity', namely, those in
favour of continuing with the status quo and opposed to change. They have
interest in a new order of things as it provides no guarantees for the
privileges earned under the old order.

Third, is a category of
persons that is in between - this group knows that continuity is
unsustainable but it is also doubtful of change and its impact on their
personal positions. There is, inevitably, continuous attrition between the
change agents and the forces of continuity.

The Rainbow Agreement has
merely blurred the boundaries between these categories, especially in making
some of the forces of continuity, to become 'reluctant change-agents'. They
are not really committed to comprehensive change but they realise that they
have limited options given the poor state of the country. They prefer a
'mixed grill' approach of the new arrangement, which entails retention of
large parts of the old order and reluctant acceptance of limited aspects of
the new order. This, however, is a dangerous cocktail that does not inspire
confidence and stifles change.

Both Mugabe and Tsvangirai find themselves
in a situation where they are change-agents, although the former would seem
to be a 'reluctant change-agent'. But even so, both have to confront, in
their own ways, what Machiavelli calls 'enemies in those who profit by the
old order'.

On Mugabe's part, the systems of patronage around which
governance has been conducted in the last 28 years depend to a large extent
on the maintenance of the old order. There are, for example, persons who
have large and enormously profitable contracts to supply goods and services
to the army, the police and other key state institutions. There are also
persons who get free seed, fertiliser, machinery, etc under the structures
of the old order.

These same people have had unlimited access to cheap
foreign currency through the Reserve Bank of Zimbabwe (RBZ), which they have
used to earn profits of obscene proportions. Indeed, such institutions at
the forefront of the old order, such as the RBZ, which is on dangerous path
of becoming all things to all people, continue against the tide of change to
engage in activities that characterise the malaise at the core of the old
order.

There are the people who have thrived and become richer when
everyone else has become poorer. This is what may be called the 'Vulture
Class' which is inextricably wedded to the old order. These persons
personify the forces of continuity that stand in the way of change.
Tsvangirai must also contend with the same forces.

But there is now,
in addition to the 'vulture class' of a political type, a further class of
opportunistic business characters, that have adapted to the abnormal
environment and, in the process, found great fortune. This group, which
falls into the third category above, can be called the 'Hyenas', because
like a pack of hyenas, they follow wounded prey and, from time to time,
nibble at the prey's wound, until, after a slow and painful struggle, it
succumbs to the inevitable.

This Hyena class is not entirely anti-change
but because it is a beneficiary of the old order, it is not an ardent
supporter of change. They have found loopholes in the system, which they
exploit to their advantage. But whilst the vultures are no longer bothered
to hide their true colours, the hyenas are very deceptive, often appearing
like friends of change but only when it suits them.

The truth,
however, is that the hyenas can survive in any environment. They are
inconvenienced but comfortable with the old order. Even though they sense
some opportunities in the new order, they are reluctant to declare their
intentions boldly. This is what Machiavelli referred to as those "who do not
truly believe in anything new until they have had actual experience of
it".

Until they actually experience the new order, they are more likely
to support the old order. The net effect is that they, too, are standing in
the way of change.

The collective result is that of all the persons,
those who are anti-change or reluctant supporters of change are also the
most economically powerful. They are the men and women who have used the
facility of poverty to enrich themselves and have very little appetite for a
new order.

Of the multitudes that support change, unfortunately, most are
the poor and indigent. They have lost much under the old order that they are
now so vulnerable. These are what Franz Fanon referred to as Les Damnés de
la Terre (The Wretched of the Earth). But their support is also lukewarm
partly because of what Machiavelli referred to as the 'fear of their
adversaries', of whom he said had 'the laws in their favour'. The violence
wrought on these communities has, over the years, shown them that they have
little power or protection of the law against the more privileged political
elites.

They want change but they remain sceptical. This scepticism can
also be a negative force in the path of change. People need to own change;
to be part of change and to be able to control their own
destiny.

Part of the shortcomings of the negotiating process leading to
the Rainbow Agreement is that it was too secretive and, therefore,
marginalised the majority of the people. As such they do not feel they have
any ownership or control over how it should work going forward. They are
mere spectators in a game in which the politicians are the critical players.
Politicians must, at this stage, do everything they can to involve the
people in the process of change. Change is more likely to succeed if
participants can feel that they own the process.

The important point
is that all this resistance to change is not unusual nor is it unexpected.
It would be naïve to expect there to be immediate transformation in the
aftermath of the Rainbow Agreement. Many of the vultures and hyenas are
struggling to come to terms with the new reality. They are re-organising;
re-strategising in order to cope with the inevitable changes. But of course
the setbacks do cause worry and provide a fertile environment for pessimism.
But surely, the forces of continuity must, one day, give way to the forces
of change.

Alex Magaisa is based at Kent Law School, The University of
Kent. He can be contacted at wamagaisa@yahoo.co.uk

Tsvangirai Frustrated

PRESIDENT Robert Mugabe is now demanding all key ministries - except finance
- in a move which has left incoming prime minister Morgan Tsvangirai
disturbed by the renewed clashes with his soon-to-be
boss.

Mugabe's demands are also jeopardising the prospect
of the power-sharing agreement signed last month with opposition Movement
for Democratic Change (MDC) faction leaders. The quarrel over cabinet
portfolios has left the country without a new government almost three weeks
after the deal was signed and three months after Mugabe was controversially
sworn in after his disputed victory in a one-man election race on June
27.

Tsvangirai pulled out of the run-off after defeating Mugabe in
March. Zanu PF also lost the election and control of parliament to the MDC.
Zimbabwe has not had a legitimate cabinet since March when Mugabe dissolved
his old team.

However, prospects of a new cabinet and
government are receding as Mugabe wants to get all key ministries after
securing the positions of head of state and government in the deal. He also
managed to get chairman of cabinet, a position which Tsvangirai initially
demanded. Mugabe is also commander-in-chief of the defence forces and
chairman of the influential National Security Council (currently Joint
Operations Command).

Sources said Mugabe on Tuesday told Tsvangirai
he was not going to concede any of the important ministries to him, except
probably finance. The move to let Tsvangirai get finance is said to be
strategic in the interests of economic revival. Tsvangirai has argued that
he can't resuscitate the economy when he is not in charge of vital economic
ministries.

The sources said Mugabe is prepared to concede finance
although he is under pressure not to let go from hardliners in Zanu PF and
government who fear that the MDC would use the portfolio to conduct
"forensic audits" of government's appalling financial record and hold to
account those found to have been involved in financial misappropriation and
corruption.

The sources said Mugabe also told Tsvangirai that apart
from principal ministries in Mugabe's original wish list that includes
defence (as well as state security which is now only a department in the
president's office), justice and information, Mugabe now wants to grab
foreign affairs, local government and home affairs which were at the heart
of the dispute two weeks ago.

Although Tsvangirai's group said
all ministries were in dispute, Mugabe and the smaller MDC faction leader
Arthur Mutambara say only finance, local government and foreign affairs are
being contested.

Sources said Mugabe indicated to Tsvangirai
that he was taking local government because his party would like to exercise
oversight on local authorities by controlling central government. The MDC
controls most municipalities in the country.

It is also said
Mugabe has refused to let go of home affairs, saying it belonged to former
PF Zapu in terms of the 1987 Unity Accord between Zanu and Zapu. Former
PF-Zapu bigwigs, including vice-president Joseph Msika and Zanu PF chair
John Nkomo, recently held a meeting in Bulawayo where it was said the
current agreement undermined the Unity Accord and ex-Zapu leaders need to
fight to keep their original gains. It was resolved that Msika must engage
Mugabe on the issue and this seems to have paid off as home affairs now
appears destined to remain under Zapu control.

The sources said
there was a gentlemen's agreement in terms of the Unity Accord that home
affairs would remain under Zapu.

"It was agreed during the unity
talks that Zapu will control home affairs as part of maintaining internal
security after the Gukurahundi debacle," a politburo member said. "Mugabe
will not let go of the ministry to the MDC."

The MDC is said to
be disturbed by such arguments since Zapu was never an issue during
negotiations and in terms of the agreement.

Sources said it is also
Mugabe's contention that foreign affairs cannot be given to the MDC because
the "president needs to appoint his own foreign minister". A source said
Mugabe would not accept having a foreign minister from the MDC because that
was not in sync with the logic of the agreement which leaves Mugabe as head
of state and government.

"As head of state Mugabe wants to appoint
his own foreign minister and not have one from the MDC who may not
articulate policies and issues the way he wants," the source
said.

It said Mugabe might finally yield finance to the MDC
although Zanu PF thinks it has a better candidate in Sylvester Nguni
compared to the MDC for finance minister. Sources said the MDC had rejected
this because "in any case it's not about that but more about who would be
able to re-establish financial relations with the outside world rather who
did finance at college". The MDC thinks Elton Mangoma is a good
candidate.

The MDC says this situation has created a deadlock,
although Zanu PF claims there is no deadlock "because initially there were
four ministries in dispute but now there is only one -
finance".

The MDC has sounded out Sadc on the stalemate. Sadc on
Wednesday asked South African President Kgalema Motlanthe to request his
predecessor Thabo Mbeki to continue as Zimbabwe's mediator in the allocation
of ministries between rival political parties.

Mugabe and
Tsvangirai met on Tuesday but failed to resolve the issue.

MDC
spokesman Nelson Chamisa said the leaders had reached an impasse and were
likely to refer the issue to Sadc-appointed mediator, Mbeki.

Informed sources said that Sadc executive secretary Tomaz Salomao had
telephoned Motlanthe on Wednesday and indicated to him that regional leaders
had asked Mbeki to continue as the mediator and that Motlanthe should
communicate this to him. Motlanthe yesterday endorsed Mbeki as
mediator.

KMAL EGM Faces Roadblock

THE proposed extraordinary general meeting (EGM) by Kingdom Meikles Africa
shareholders led by chairman John Moxon on October 23 to fire CEO Nigel
Chanakira and two other board members could hit a snag as minority
shareholders of the conglomerate are set to launch a massive legal challenge
against attempts to remove the directors.

The Zimbabwe
Independent can reveal that the small shareholders were this week seeking
legal counsel from lawyer Addington Chinake of Kantor & Immermann to
stop Moxon from calling an EGM to remove Chanakira and directors Callisto
Jokonya and Rugare Chidembo from the board.

Moxon is proposing that
the trio be replaced by Marilyn Hugill, his sister, and South African-based
Ashwin Mancha, Jack Mitchell, Fiona Silcock and Carl Stein, all linked to
his family.

Information to hand shows that
the minority shareholders who are expected to file an urgent High Court
chamber application today were also lobbying the Reserve Bank to intervene
because they assert KMAL is a holding company for a financial institution -
being Kingdom Bank - which is governed by the Banking Act.

They
therefore want the High Court to issue a declarator to this effect. This
would mean that no board member of KMAL can be removed without approval of
the central bank, neither can new board members be appointed without the
RBZ's nod.

The minor shareholders also want Moxon to publish a
circular to all shareholders explaining the nature of the conflict in the
board. They are also questioning the appropriateness and impartiality of
Muchadeyi Masunda who has been retained as chairman of the EGM.

KMAL board chairman Moxon is temporarily relinquishing the position for the
EGM to avoid a conflict of interest.

The minor shareholders want
the court to stop Masunda from chairing the EGM because they believe that he
has had a long relationship with Moxon as board member of Meikles before the
merger with Kingdom Financial Holdings, Tanganda and Cotton Printers to form
KMAL.

They will also argue that Masunda is an inappropriate chair
by virtue of being mayor of Harare. Masunda is a board member of at least a
dozen companies quoted on the Zimbabwe Stock Exchange.

But it
is the quest to remove the directors that has set Moxon and the minority
shareholders on a collision course. The smaller shareholders this week told
the Independent that they had not been furnished with information on the
nature of the conflict between Chanakira and Moxon. They have also said that
they have not been served with the notice for the EGM.

"Other than
what we saw in the newspapers, there has been a paucity of information on
what is actually happening in the company in which we are shareholders,"
said a CEO of a listed company which holds shares in KMAL.

"We
cannot go into the AGM blind and take a decision which could hurt our
businesses. What corporate governance are we talking about here?"

RG's Office 'denies' Tsvangirai Passport

Thursday, 02 October 2008
22:29THE Morgan Tsvangirai-led MDC yesterday alleged that government
was refusing to renew its leader's passport in a deliberate attempt to bar
him from travelling in the region and beyond to appraise leaders on
political developments in the country.

Tsvangirai, who
is prime minister-designate in an all-inclusive government made up of his
party, Zanu PF and the smaller formation of the MDC led by Professor Arthur
Mutambara, is still without a passport three months after it expired and he
applied for a new one.

The Registrar-General (RG)'s office in
Harare was reportedly reluctant to issue Tsvangirai with a new passport or
an emergency travel document for him to visit regional and international
leaders to update them on the impasse between him and President Robert
Mugabe on the formation of a new cabinet.

Sources in the MDC
said the RG's office was claiming that it had run out of materials to
produce passports, but senior officials in the same office said hundreds of
Zimbabweans were issued with the travelling documents after Tsvangirai's
application.

George Sibotshiwe, Tsvangirai's spokesperson,
yesterday said the refusal to give the MDC president a passport was a
deliberate move by the state to bar him from travelling.

"There
is a deliberate plot in government to prevent Tsvangirai from accessing
regional and international leaders at this very crucial moment for
Zimbabwe," Sibotshiwe said. "It is critical for him to consult with leaders
in the region and internationally and denying him a passport as a Zimbabwean
is an infringement of his human rights."

Sibotshiwe said the
delay in issuing the passport was affecting the party's regional and
international diplomatic activities.

"The president has to engage
colleagues in the region and internationally, especially now, to find ways
of how he can help to make Zimbabwe move forward and to appraise them on the
progress of the negotiations," he said.

Tsvangirai applied for
a new passport in May after the pages in his old one had been
exhausted.

In Zimbabwe, it normally takes two working days for an
emergency passport to be issued, but Tsvangirai was told on several
occasions that there were no passport materials.

President
Mugabe reportedly took an entourage of 54 people to the UN General Assembly
in New York last week.

UZ, Nust Open Under Shocking Conditions

Thursday, 02 October 2008
22:27TWO of the country's leading universities -- the University of
Zimbabwe (UZ) and the National University of Science and Technology
(Nust) -- are expected to re-open next week for the last semester this year
amid reports that lecturers will be on strike and that results of many
students are not yet out.

The opening of the
universities has been postponed on several occasions because of the
lecturers' industrial action pressing for better salaries and working
conditions.

While the UZ opens on Monday, there is no water supply
at the institution, and there is a critical shortage of academic and
non-academic staff.

Tafadzwa Mugwadi, a political science
student, yesterday said: "There is inadequate staff, both academic and
non-academic, at the campus and the water they promised is not even coming
out from the taps."

Students said UZ students lacked critical
resources for their studies.

"There is shortage of resources," a
student from the veterinary department said. "Drugs such as anaesthetics for
surgeries and antibiotics are not available. X-ray machines for our
practical studies are not working."

UZ lecturer John Makumbe
wondered why authorities wanted the college to open on Monday.

Makumbe said: "Most lecturers are not coming to work because they do not
have money. There is no water and a lot of toilets are still blocked. It is
impossible to hold lectures in some of the lecture rooms because of the
smell from the toilets. That the boreholes are all rehabilitated and are
working is simply fiction."

"There is total confusion at the
UZ; you find students registering without knowing what their last semester's
results were. At the end of the day it will affect them during the course of
the semester."

The UZ acting director of information and public
relations, Daniel Chihombori, yesterday said the harsh economic environment
presented serious challenges to the resource mobilisation process at the
college, hence necessitating the postponement of re-opening of the
university on several occasions.

He said stakeholders were
working flat out to ensure that lectures start on Monday.

"Most
of the (students) results have been published already," Chihombori said.
"Work on the rehabilitation of boreholes and the improvement of the water
situation on the campus is on-going. The parties to the problem are working
hard to ensure that the institution has adequate and continuous water
supplies."

He said while the UZ has been losing staff, it was
continuously hiring new employees, as well as benefiting from its investment
in local and international staff development programmes.

"We
are aware that the university has been facing challenges with respect to the
rehabilitation and/or repair of some teaching equipment because of lack of
spares (not available locally). We, however, are not aware of the shortage
of the specific machines that you mentioned," Chihombori said.

At Nust, the strike by lecturers forced the college authorities to delay
reopening and threatened to disrupt the annual graduation ceremony next
month.

Initially, the college was supposed to open on August 25,
but the date was moved to the end of September because of the industrial
action, before it was moved to October 6.

The lecturers are
demanding a basic monthly salary of US$4 000 or R31 000 for the least paid
academic staff.

Mpariwa Slams Moyo Over Lawsuit

Thursday, 02 October 2008
22:25MDC House of Assembly deputy chief whip Paurina Mpariwa has
described Tsholotsho North legislator Jonathan Moyo in court papers as an
"unprincipled opportunist" who represents everything wrong about present-day
Zimbabwe.

In an opposing affidavit against Moyo's
application seeking the nullification of the election of MDC national
chairman Lovemore Moyo as Speaker of the House of Assembly, Mpariwa said the
former Information minister was a "dishonourable member of parliament" who
worked against press freedom and was once involved in a plot to unseat
President Robert Mugabe.

Moyo lodged an application in the High
Court last month arguing that MDC MPs had violated the principle of a secret
ballot when the party's national chairman was elected Speaker.

The Tsholotsho North MP accused MDC secretary-general Tendai Biti of failing
to set an example to his fellow lawmakers. He said Biti was the first to
violate the secret election principle after he showed his completed ballot
to MPs from his party.

The former minister's application
read: "The election of Speaker on Monday August 25, 2008 was characterised
by systematic and scandalous irregularities never before witnessed in
parliament."

But Mpariwa in her opposing affidavit said the
challenge against the election of the Speaker by Moyo was an "unholy
project, born of the machinations of Zanu PF and its friends in the (Arthur)
Mutambara group who are bent on ensuring that the current political status
quo existing in this country continues unabated."

She said Moyo
had a long history of treachery which started during the liberation struggle
when he escaped from a training camp.

Mpariwa said: "During the
liberation struggle he (Moyo) was the first successful escaper from Mgagao
training camp, Tanzania, only managing to escape after a second attempt. For
a long time he was a known critic of this regime (Zanu PF) but
opportunistically in 2000 he became a minister in the present regime and was
responsible for the total extermination of press freedom and press rights in
Zimbabwe.

"This destroyer of press freedom was later involved in a
plot to unseat the leader and President RG Mugabe, in what was has now come
to be known as the Tsholotsho Scandal in November 2004 (sic)."

Mpariwa claimed that Moyo bounced back into Zanu PF between May and June
2008 to run the propaganda and information campaign for Mugabe.

She
said: "In short, he is a totally unprincipled opportunist individual who
represents everything wrong about present-day Zimbabwe. His reason for
participating in this present application is probably to try and further
ingratiate himself with Zanu PF in the hope that he can be a government
minister."

She said on the day of voting for the Speaker, it was a
requirement to show the clerk of parliament Austin Zvoma the completed
ballot paper.

"It meant implicitly that one would fold the ballot
outside the polling booth after showing it to the first respondent (Zvoma)
and then placing it in the ballot box," Mpariwa said.

She
dismissed claims by Moyo that the MDC MPs made a noise as "totally dishonest
and untrue".

"Whilst there was noise in parliament, virtually all
members of parliament made noise including and in particular Jonathan Moyo
himself, one Patrick Zhuwao and Saviour Kasukuwere," she
claimed.

She insisted that MPs voted in secret and no one knew how
they voted, adding that Moyo's claims that the MDC legislators showed their
completed ballots to senior party members were fiction.

"Jonathan Moyo, the author of Voting for Democracy, a book that bears
uncanny proximity to Beatriz Mazaloni's Voting for Autocracy, is the new
Geoffrey Archer. I have not seen the video tape being referred to and I
challenge its authenticity and its production thereof," Mpariwa said in her
affidavit.

She said Moyo's allegations were without any
evidence or substance.

"This is a completely fictitious
construction for a number of reasons, firstly nobody knows what Hon Biti's
vote was. For Jonathan Moyo's construction to make any sense, he would have
to prove that Hon Biti voted for the second respondent (Lovemore Moyo). This
cannot be proved," Mpariwa argued.

"I saw no one displaying any
vote to anyone. To make this allegation against the members of parliament
without inviting them to hear their side of the story is
unfair."

Mpariwa said Moyo, Kasukuwere and Zhuwao instead were the
ones who had been boasting in the common room of parliament that they were
going to win the vote as they had "bribed" MDC MPs.

"Members of
parliament voted in secret in the polling booth. There is no one who
interceded with the voting process in that polling booth. Each of these
members is an adult and no gun was ever pointed," she said.

Mpariwa
said a report in the Hansard was accurate on what transpired on August 25
and insisted that the suggestion that there was a violation of the secrecy
of the vote was "vacuous".

Mpariwa said that there was nothing
unprocedural about the election that was held and if there was any, members
would have protested and refused to vote.

She said: "The fact
that Emmerson Mnangagwa representing Zanu PF and Moses Mzila Ndlovu
(representing MDC-Mutambara) were gracious in their defeat, should teach
lessons of decorum to the likes of Jonathan Moyo."

Mpariwa said it
was at the MDC-Mutambara meeting in Kadoma that Moyo and Senator David
Coltart decided "maliciously" that the election of Speaker of parliament had
to be challenged.

"In fact Jonathan Moyo was bang(ing) tables and
declaring that Lovemore Moyo would never be a Speaker as long as he was
alive. Coltart for instance makes wild and unsubstantiated allegations that
the MDC met in the evening before the vote and force-marched members of
parliaments to go and vote the Speaker. That is totally untrue and without
evidence at all," Mpariwa said.

The Speaker described Moyo's
application as "vindictive, malicious, opportunistic and totally without
foundation".

However, Zvoma in his affidavit said the High Court
had jurisdiction to deal with the case. Moyo is in the process of preparing
his answering affidavit before the court can set a date for the case's
hearing.

Zanu PF In Financial Dire Straits

Thursday, 02 October 2008
22:22ZANU PF is facing serious financial problems amid reports that it
has been battling to pay its 500-plus workers since
March.

Impeccable sources said the party has since tasked
its national fundraising committee to mobilise $50 billion to meet its
recurrent expenditure, employees' salaries and bankroll its annual
conference to be held in Bindura in December.

The sources said
Zanu PF failed to pay its employees from March to August after it committed
funds to the campaign for the March harmonised elections and the bloody June
27 presidential run-off election.

"The workers were not paid for
six months since March," one of the sources said. "Instead, the party has
since June been giving the workers fuel for resale to sustain themselves and
their families."

The sources said directors in Zanu PF were getting
200 litres a month while the least-paid employees were being allocated 25
litres.

Zanu PF has a credit facility with the National Oil Company
of Zimbabwe and it is this arrangement the party is using to source fuel and
allocate it to its employees.

Efforts to get a comment from
finance secretary David Karimanzira were in vain yesterday, but last week he
told Zanu PF's official mouthpiece, The Voice, that the party was in
financial difficulties.

Karimanzira, the governor and resident
minister of Harare, said Zanu PF wanted to mobilise $50 billion to meet its
day-to-day expenditure, pay salaries and finance its national
conference.

He confirmed that the party was having "challenges"
paying its employees and has over the past "few months" met its recurrent
expenditure through overdrafts.

"The major challenge still
remains on the funding of salaries of the party workers, other party
programmes, especially those initiated by the commissariat, for example, the
ongoing restructuring exercise, 2008 annual conference in Bindura and the
day-to-day administrative expenditure," Karimanzira said.

"So
it is upon all provinces fundraising committees and the national fundraising
committee to redouble efforts in fundraising activities. The national
fundraising committee is expected to raise $30 billion and the 10 provincial
committees $20 billion."

He said as part of mobilising the funds,
the Zanu PF finance department had reviewed upwards the price of membership
cards.

The approved new rates for a membership card of a politburo
member is $3 000, central committee member $2 000, national consultative
assembly $2 000 and district coordinating committee members $1
000.

Before the presidential run-off, Zanu PF was reportedly facing
serious financial problems and was allegedly bailed out by the Reserve
Bank.

Southern Region Faces Starvation

Thursday, 02 October 2008
22:20PEOPLE in the southern region of the country are facing
starvation as food shortages have reached critical levels with villagers
exchanging their livestock for maize and other basic
foodstuffs.

Reports from Tsholotsho, Binga, Hwange, Gokwe
and Gwanda indicate that there was a food crisis in these
areas.

The southern region, made up of the three Matabeleland
provinces, Midlands and Masvingo, are in the drought-prone parts of the
country and are usually the hardest hit by food shortages.

Signs of a looming hunger are evident almost everywhere in Zimbabwe's
countryside where the majority of villagers are dependent on food aid from
non-governmental organisations.

An official from the governor's
office in Matabeleland North, who spoke on condition that he was not named,
said the food situation was critical in the province as maize deliveries
were very low.

The official said the maize the state-controlled
Grain Marketing Board (GMB) was receiving was not enough to cater for
villagers, adding that the food crisis in the province was a disaster
waiting to happen.

"Maize stocks are inadequate and all the GMB
depots in the province have not been receiving maize frequently," the
official said. "They (maize deliveries) have been erratic except for the
Bacossi packs that were supplied to a selected number of villagers long
ago."

However, Matabeleland North governor Sithokozile Mathuthu
said talk of food shortages was false.

"The media is imagining
all the food shortage stories they are writing about," Mathuthu
said.

"We have maize coming to the GMB on a daily basis and we have
records to prove that there is plenty of food for everyone. All the food
shortage stories are false."

She said the government was
importing food and in circumstances where there were shortages, the
deliveries would have been delayed.

In Matobo district of
Matabeleland South villagers are exchanging their livestock for maize and
other basic commodities.

Goods that are exchanged for livestock
include cooking oil, sugar, soap and salt.

Zimbabwe's food
situation has deteriorated to critical levels with maize, the staple food
for Zimbabweans, being unavailable in shops.

This week, Prime
Minister-designate Morgan Tsvangirai said the country was facing a
"disastrous" food crisis and called for the urgent formation of a new
power-sharing government.

"We need to respond to this crisis with
utmost urgency. It is therefore imperative that a government be formed in
the next few days and begins to implement plans to ensure that our people
have food and do not die of starvation," Tsvangirai told reporters in
Harare.

Earlier this year, the United Nations estimated that more
than five million people out of a population of 12 million would require
food assistance in the first quarter of 2009.

The United
States-based Famine Early Warning Systems Network warned last week that
Zimbabwe could run out of cereals by November.

Mavambo Adopts Draft Constitution

Thursday, 02 October 2008
22:18FORMER Finance minister Simba Makoni has moved up a gear in
transforming his Mavambo/Dawn/Kusile movement into a fully-fledged political
party after his national management committee last week adopted the proposed
party's constitution, policies and principles.

Sources
told the Zimbabwe Independent that at a joint meeting of the national
co-ordinating and management committees, Makoni said the party, to be called
the National Alliance for Democracy (NAD), would be launched before
year-end. The sources said the NAD constitution spells out that the party
should be rooted in nationalism and Pan-Africanism.

"The ideology
and principles of the party are more or less similar to those of Zanu PF,
but make it clear that leadership should be renewable," one of the sources
said.

"The constitution sets a two five-year term limit for the
president and also espouses the goals and objectives of the
party."

Makoni left Zanu PF in February to form the movement
claiming that President Robert Mugabe's endorsement during last December's
extraordinary congress in Harare was unconstitutional. He said Mugabe had
manipulated party structures into closing the door for leadership
renewal.

Makoni contested the March 29 presidential election as an
independent candidate against Mugabe and MDC leader Morgan Tsvangirai and
came out a distant third in the poll.

Denford Magora, the
movement's spokesperson, confirmed last week's meeting, adding that the
adopted draft constitution and the proposed policies and principles have
since been taken to the country's 10 provinces for "further consultation and
input" from Mavambo's supporters and members.

He said all
provinces, including the three in Matabeleland that threatened to leave the
movement, attended the meeting.

"We are being methodical in our
approach because this new party is owned by the people, just as Makoni
himself is owned by the people of Zimbabwe," Magora said. "We must all play
our part in ensuring that Zimbabwe becomes a truly stable democracy,
eliminating all risks that may see us fall back into a situation where one
man can hold the entire nation to ransom." - Staff Writer.

Health Delivery System Continues To Collapse

Thursday, 02 October 2008
22:02IT is around 3am and 30-year-old Kudzanai Toziva cannot endure
anymore the excruciating pain in his body.

His legs are
swollen and he is shivering despite a high body temperature, his breathing
is heavy and he is gasping for air.

His 24-year-old wife Nokhutula
looks on helplessly and does not know what to do except to call close
relatives to take Toziva to hospital.

On their way into town they
debated on which hospital to take Toziva to. One relative suggested
Parirenyatwa Hospital, but everyone turned down the proposal arguing that
the health institution had serious drug and staff shortages.

They later settled for a private hospital.

They drove to Westend
Clinic and were confident that Toziva would be attended to and relieved of
his pain.

However, things did not happen as they expected. Instead
of Toziva being admitted they were told that the hospital had no adequate
staff to help them.

They carried Toziva back to their
car.

With the little cash they had in their pockets they wondered
where to go next as most hospitals were now demanding huge sums of money in
cash and high amounts for a bank transfer or cheque.

The
Avenues clinic was their next port of call, but upon arrival Toziva, who is
a medical aid society cardholder, was told that beds were full and he could
not be admitted.

Finally, after moving from one place to the other,
Toziva was admitted at another private hospital in the Avenues area at
around 4pm, more than eight hours since he started feeling the
pain.

The hospital said they were ready to assist him, but they
needed to decide first how much he should pay before admitting
him.

The millions of Zimbabwe dollars they demanded were outrageous
since the maximum daily withdrawal limit for individuals is pegged at $20
000. The Toziva family pleaded with the administration to pay in the form of
a bank transfer.

After consultations they finally agree, but
were told that there were hundreds of thousands of dollars they had to pay
in cash.

"I had to ask a friend of mine kuti andipisirewo (do an
RTGS of) US$400 into my account that I could transfer to the hospital's
account," Toziva's sister said. "I was lucky the hospital agreed because we
share the same bank so it was going to be an internal
transfer."

The doctor who examined Toziva said there was excess
water in his body, some of it having found its way into his lungs. The
doctor said the excess fluid had to be removed using a
catheter.

It took time for Toziva's family to raise the required
money to remove the excess water and as a result he died on Wednesday. He
died a bitter man.

Toziva might have succumbed to complications he
experienced, but his parents still feel that hospitals could have helped him
if they had attended to him earlier.

"People might say one
cannot run away from the angel of death, but if they had attended to my son
urgently maybe he would be alive today," said his mother, with streams of
tears running down her cheeks.

The health delivery system in the
country, according to a number of medical practitioners, has "gone to the
dogs" as most of the country's major hospitals are out of drugs, food,
functioning equipment and shortage of staff.

Parirenyatwa
Hospital, for instance, is reported to have a critical shortage of
medicines.

Most of the time the hospital doesn't have adequate
water supplies and as a result a number of toilets have been closed
down.

Posters reading, "no water, use the bucket" can be seen on
toilet doors while some of the toilets are locked to prevent
use.

A patient who preferred anonymity expressed disgust at the
hospital's shortage of water saying it was unbelievable that such a big
hospital should be left to operate without a constant water
supply.

"Some toilets are said to be out of order. Honestly, how
can a big hospital have toilets not working?" she said.

This
week, Heath minister David Parirenyatwa was quoted by the state media saying
drug stocks had improved by between 60% and 70% in the country's major
hospitals. The new stocks include antiretroviral drugs and chronic
ambulatory dialysis kits.

However, the president of the
Hospital Doctors Association, Amon Severeki, said the supply of critical
drugs was not even close to enough.

Severeki said: "It is funny
because as we speak there are no drugs at Parirenyatwa Hospital and I am
talking about just basic drugs like antibiotics and vial
injections.

"There is a serious shortage. Patients are told to buy
the vial injections at pharmacies, which might be going for $1 million each
and probably one person will need about 50 of them. You can imagine, where
will they get that kind of money?"

A senior medical doctor
working at a private hospital who recently toured Harare Hospital, popularly
known as Pagomo, said the standards at the hospital had deteriorated so
badly that the hospital needs to be closed for renovation.

The
doctor said: "The place is not fit to be called a hospital. The hospital's
tiles have peeled off, some of them are dirty to the extent that you can't
believe that they used to be white. Most of the equipment is not working and
there is no adequate food for patients. That hospital needs to be closed for
renovation. It is in a sorry state."

While women on maternity are
given a list of items they have to bring so that they can be helped to
deliver. The list includes 10 pairs of gloves, a needle, wool or thread,
three candles, matches, blanket, sheets, syringe, surgical blade, BCG
injection and umbilical pin.

A lot of people now pin their hopes on
the deal that was signed by President Robert Mugabe and leaders of the two
MDC formations -- Morgan Tsvangirai and Arthur Mutambara -- to address the
problem of poor health delivery in the country.

However, people
have to wait a little longer as the principals to the deal are yet to agree
on the formation of a cabinet tasked with revamping the country's social,
political and economic state.

Preparations For Farming Season Lagging Behind

Thursday, 02 October
2008 22:00A LONG drive along the Harare-Chirundu Road paints a gloomy
picture of the country's state of agricultural preparedness ahead of the
summer cropping season.

With no signs of ploughed land,
the once vast evergreen stretches of prime land in Mashonaland West have
been left idle -- which could be a problem for a country targeting two
million hectares for maize production this season.

So troubled
is the country's agricultural sector that regional leaders have called for
immediate assistance to the once breadbasket of southern
Africa.

Officiating at the historic signing of the inclusive
government deal on September 15, former South African president Thabo Mbeki
appealed to Sadc and other African nations to rescue Zimbabwe as a "matter
of urgency" to avoid food shortages.

Despite public pledges by
Sadc, experts warn that the 2008/9 agricultural season was destined for doom
because of a combination of reasons, among them a poor transportation
infrastructure and shortages of critical inputs.

According to
the Commercial Farmers Union (CFU), the country's transportation
infrastructure and fuel would not cope with the pledged regional support to
re-stock agricultural inputs for the summer season.

Instead, the
CFU urged government to prioritise food imports.

"The country has
no infrastructure to transport the huge amounts of inputs required and this
could delay the planting exercise which normally starts in four weeks," a
CFU official said. "A lot of effort has to be put towards food importation
in the next six months. There is no chance of producing much this
year.

There is need to put more priority in growing more seed maize
this season. The country's troubled train operator, National Railways of
Zimbabwe, has few coaches to ferry the enormous amounts of pre-season inputs
from neighbouring countries."

Local maize seed companies on the
other hand are expecting to produce 18 000 tonnes of seed against an annual
national demand of over 50 000 tonnes.

Fertiliser from local
manufacturers, sources said, cannot exceed 50 000 tonnes which is enough for
400 000 hectares of maize. Government is targeting two million hectares for
maize production this season. This means that over 100 000 tonnes have to be
imported resulting in the aggregate locally manufactured inputs and imported
inputs only enough for a maximum of 1,2 million hectares.

Agricultural experts, however, are cautious that the importation of inputs
could result in the procurement of sub-standard products.

Government through the Reserve Bank of Zimbabwe has been trying to address
the supply side of inputs through quasi-fiscal undertakings. Recently the
central bank injected US$13 million to improve fertiliser
production.

Shortages in herbicides on the local market could
also scuttle government plans to maximise productivity.

The CFU
also lamented the delay by the Reserve Bank in paying the wheat support
price to producers for last year's crop.

"Financing the new
agricultural season could be a problem for most farmers. Wheat producers
have not yet received payments from the Reserve Bank and this will affect
our plans to produce more," the CFU said. "The government has not yet
announced the new producer prices for the crop, which is expected to be
harvested in a week or so."

Independent forecasts indicated winter
wheat production will drop from last year's output of 62 000 tonnes owing to
a host of problems, among them electricity shortages to run farming
equipment, fuel shortages and payment delays by the
authorities.

Barely 10 years ago wheat farmers produced 270 000
tonnes against a national requirement of 350 000 tonnes.

Former
Grain Marketing Board chief executive officer and MDC secretary for
agriculture, Renson Gasela, said the country was still lagging behind in
preparations for the new season.

He said: "We are not prepared
at all. That is why Mbeki made that important appeal to Sadc to offer
assistance as soon as possible. The centralisation of the distribution of
inputs through the GMB or government programmes like Operation Maguta could
negatively affect productivity. GMB is militarised at the
moment.

"This has deprived many small farmers from accessing
inputs. What is required is the decentralisation of distribution and
synchronising the distribution of seed and fertiliser."

Packaging the inputs in "smaller quantities", Gasela said, could also enable
urban growers to easily access inputs at affordable prices and also minimise
reselling of the critical inputs on the parallel market.

Efforts to get comment from Agriculture
minister Rugare Gumbo were in vain, but key strategist in the government's
Resource Mobilisation and Utilisation Committee, Misheck Sibanda, last week
said the committee had made "tremendous preparations" for this
season.

Experts also warned that a massive exodus of farm labourers
to neighbouring countries like South Africa and Zambia could worsen
productivity on both communal and commercial farms. Commercial agriculture
prior the ill-planned agrarian reform of 2000 was the largest formal sector
employer in the country.

The General Agriculture and Plantation
Workers Union of Zimbabwe (Gapwuz) last week warned that delays by President
Robert Mugabe and the two MDC formations to appoint a new cabinet could
result in a "failed season".

Tapiwa Zivira, Gapwuz information
secretary said: "As a union that represents the interests of the most
mariganlised group, the farm workers and rural communities, we are therefore
calling on the three political parties to quickly resolve whatever
differences they have and start working together for national
development.

"Far from delaying economic recovery, the political
impasse is hindering preparations for the coming rainy season and this may
mean yet another failed season."

Before 2000 the commercial
sector contributed 75% of grain reserves delivered by communal farmers, but
an emerging trend indicates declining output by the latter. Statistics show
that commercially produced commodities for last year accounted for 42% of
the aggregate produce in 1998.

Government has often blamed natural
causes for the poor yields, but it will have to come up with another excuse
if the country experiences a poor harvest after the meteorological
department forecast a favourable rainfall pattern.

Meanwhile,
the selling season for tobacco closed below the projected 73 million kg that
was initially targeted. The Zimbabwe Tobacco Association this week said that
farmers could meet a target of 70 million kg in the forthcoming
season.

Experts said there were inadequate seedlings this season.
Statistics by the ZTA indicate that it costs at least US$7 500 to plough a
hectare of tobacco.

Zimbabwe's poor agricultural output has
been blamed on the chaotic land reform the government embarked on in
February 2000 after it lost a constitutional referendum.

A
United Nations Development Programme report released last week said the
government must revisit agricultural policies in the "post crisis" period
with a view to completing the controversial land reform.

"The main
policy recommendation is therefore to revise the current land laws to
conform to the post-crisis land policy and the agricultural recovery
strategy," the report said.

Shops Ordered To Revert To Old Prices

Thursday, 02 October 2008
21:01THE National Incomes and Pricing Commission (NIPC) has ordered
business to revert to September 26 prices or risk being fined or having
their licences revoked.

NIPC chairman Godwills
Masimirembwa told businessdigest yesterday that they had ordered all
businesses which had not been given the green light to hike prizes to
abandon the increases.

"A clampdown has started on all shops that
are charging prices that had not been approved by the NIPC," Masimirembwa
said.

"Another serious issue that could see many shops being fined
or risk having their licences revoked is having multiple prices," he
said.

Masimirembwa said a recent survey by NIPC revealed that most
shops were charging cash prices that were lower than they had approved,
while charging "unjustified" prices for cheque or Real Time Gross Settlement
(RTG) payments.

Some shops yesterday were said to be
"temporarily closed" following a tip-off that NIPC officers and police
details would be "visiting" their shops.

"Shops are taking
advantage of the current cash shortages to charge cash prices that are below
what we would have approved. They will in turn charge unrealistic prices
when one pays by cheque or transfer," Masimirembwa said.

Masimirembwa said some shops were increasing their prices in response to the
Reserve Bank's maximum daily withdrawal limits and introduction of higher
bank denominations.

Individuals can now withdraw $20 000 up from $1
000, while withdrawals for companies are up from a mere $1 000 to $10 000.
The RBZ also introduced a new $10 000 and $20 000 which do not have properly
crafted security features.

The cash review by the central bank
came against a background of salary increments for the civil service and
increased volumes of foreign currency trades on the Real Time Gross
Settlement system.

However, the new daily limits have been
overwhelmed by sharp increases of prices of basic goods and services that
are currently being charged using a dual pricing system - the cash rate and
the point-of-sale rate (commonly referred to as the swipe rate.) This week's
rampant price increases are also largely speculative following reports of a
political deadlock on the formation of a new inclusive
government.

Bankers Association president John Mangudya yesterday
told businessdigest that no amount of daily limits under the prevailing
macro-economic environment would meet daily cash demands unless capacity
utilisation by local manufacturers is resuscitated. Statistics show that
industry is currently operating below 30% of capacity although there is hope
for increased productivity resulting from the licensing of foreign currency
retailers and wholesalers by the central bank.

"The only
problem the country's is facing is failure to increase production," Mangudya
said.

"No amount of limit could be sufficient under the prevailing
conditions . . . queues at banks are a result of high inflation. The
propensity to save is diminished under prevailing conditions hence people
often visit banks to withdraw cash."

A bank in central Harare
this week used comical means to control a big crowd desperate to withdraw
their cash. They instructed soldiers to mark everyone on the cheek.
Anti-riot police could also be seen keeping watch on the long winding queues
in anticipation of chaos.

Gono speaking at an agricultural show in
Masvingo said: "I will not stop printing money. It is for infrastructural
development until sanctions are removed."

Meanwhile the public
has expressed concern over the security features on the new $20 000 note
amid reports of counterfeits in circulation. A depositor was this week
arrested and later released on suspicion of possessing fake notes. The bill,
unlike other notes in circulation, is made of poor quality paper and also
lacks conventional security features such as the watermark.

Year-on-year Tobacco Deliveries Down

Thursday, 02 October 2008
20:57THE tobacco-selling season has closed at just over 50 million kg
and year-on-year deliveries to the country's auction floors continue to
decline.

Business reporter Bernard Mpofu speaks to Zimbabwe
Tobacco Association president Andrew Ferreira on the future on golden and
perennial problems associated with tobacco farmers.

Mpofu:
Initial forecasts predicted tobacco deliveries to be 70 million kg, but
statistics at the close of selling season indicate that the target will not
be met. What went wrong?

Ferreira: Initial forecasts were based on
seed sales, where commercial farmers use 5,5 grammes per hectare while
small-scale farmers use 7,5 grammes. The difference is due to the economies
of scale. This indicated that potentially, some 50 000 hectares could be
planted. The nature of the season, difficulty in sourcing inputs (finance
and physical) meant that, the target was never reached.

The
excessive rain further compounded this especially in December, when yield
was negatively affected.

Overall potential was again affected by
power outages and the challenge of bringing coal from Hwange
colliery-required for curing. The challenges of real value for tobacco have
prompted farmers to hold back deliveries in the hope that the gap between
inter-bank and markets rates narrow.

Mpofu: How much tobacco do
you expect to be delivered during the mop up sales?

Ferreira: I
believe as much as 5 million kg could be delivered during mop up. Tobacco
Industry Marketing Board will have more reliable estimates, as farmers have
to submit crop estimates to them.

Mpofu: What is your view on the
quality of tobacco that was brought to the auctions floors during the
selling season?

Ferreira: Overall the quality of this year's crop
was acceptable to the trade. The only reservation being the lack of
volume.

There is demand for the Zimbabwean crop by cigarette
manufacturers, however this is at a price and as growers, we cannot price
ourselves out of the market by unfair marketing practices.

The
playing field for buyers must be levelled and as industry, we have to get
rid of special deals. There are some buyers who are allowed to use Zimbabwe
dollars as payment and hence use the varying exchange rates to their
benefit.

Mpofu: What is your take on the on-going inter-bank
exchange rate in relation to the tobacco pricing system?

Ferreira: My opinion on the exchange rate can be best illustrated by
example: a red mile curing plate made in Zimbabwe is costing $288 000. At
the inter-bank rate this equates to US$2 400 when it should not cost US$65,
which it did in May. A loaf of bread at the current inter-bank rate is US$13
or 4 kilograms of tobacco, when it should be a third of a
kilogramme.

Mpofu: Could you please explain the reason why tobacco
prices failed to match those in Malawi for example?

Ferreira:
Information at hand suggests that we are receiving above regional prices.
The early price distortions in Malawi were because of marketshare
aspirations, which soon settled and more so, we must realise that Malawi is
dominated by burley tobacco.

Mpofu: What preparations have you made
so far for the next season and what challenges are farmers currently
facing?

Ferreira: Preparations for the new season are well behind
and farmers face a number of challenges. The most important being that, very
few inputs are available locally. Those that are available are hugely
expensive. Seed sales are marginally down on last year.

Many
farmers are facing a new wave of eviction with violence and theft at levels
rarely seen before.

Farmers are also asking, "Where is the finance
for the new season coming from?"

Labour moral is at the lowest
ever. Current viability does not allow in real terms for any increase in
wages or benefits. This is not helped by the difficulty in sourcing
cash.

The country is in a state of "political drift" which inspires
no confidence. This only adds to the vicious inflationary spiral. Hopefully
this is only temporary.

Mpofu: Can you furnish us with the
hectarage and forecasts on costs for the next season? .

Ferreira: All things being equal, we might be able to plant 35 000ha to 45
000ha, so we have potential of getting up to 70 million kg.

Mpofu:
Production continues to decline over the years and you cited a host of
reasons for this trend. What should government do to reverse this
trend?

Ferreira: A lot of things need to be done and these
include:

A substantial Zimbabwe dollar bonus for US dollar earned,
retrospective to balance the viability differential. One kilogramme of
tobacco at US$3,00 does not even buy a loaf of bread.

The
honouring of the 25% foreign currency account retention.

Concessionary funds like the Agricultural Support Productivity Enhancement
Facility or similar packages to be put in place soon in order to kick-start
land preparation. There is a two-week window of opportunity.

The
dry land crop must be planted by October 20, especially with the tremendous
increase in aphid population as indicated by the Tobacco Research
Board.

Allowing contracting merchants to provide ration packs
on the same criteria as other inputs.

Ensuring that anyone who
grew last year is able to grow this year, with a moratorium on arbitrary
evictions.

Providing a bonus and protection for any farmer who
produces 10 hectares or more extra seedlings. This can be easily
verified.

Mpofu: You have mentioned on numerous occasions that your
sector is reeling from massive labour flights mainly to neighbouring
countries. How best can staff retention be promoted?

Ferreira:
Regional producers are paying an average of US$1 per day and local farmers
cannot pay that much.

Unless some of the concerns raised above are
met labour problems will continue.

RBZ Should Focus On Core Business

Thursday, 02 October 2008
20:54THE article in the Herald, September 30, on the RBZ forming a
public transport company leaves a lot to be desired.

I
respect and commend the RBZ governor, Dr Gideon Gono, on the initiatives he
is taking to improve not only the public transport system in Zimbabwe but
other sectors of the economy.

However, I question the rationale,
planning and strategy used in developing and implementing the public
transport company taking into consideration that the market is
one.

We do not need a second rival from the same owner, being the
state in this case.

This company will simply be a duplication
of roles. The Zimbabwe United Passenger Company (Zupco) already serves this
purpose.

Public transport has traditionally been defined as any
transport system in which passengers do not travel in their own or private
vehicles.

The companies are normally owned and controlled by
municipalities or the central government.

A public transport
system usually consists predominantly of rail and bus services that are
subsidised by the government at local level or national and the mini-bus
taxi services, which are unsubsidised.

These three modes do not
work in an integrated fashion and usually compete with one another for
commuters. In some cases this competition has led to price cuts and price
wars.

A public transport service needs to provide more than a
peak-hour commuter service, with a limited off-peak service.

It
needs to provide an affordable, comfortable, efficient and reliable service
throughout the day. An ideal public transport service should be comparable
to private-vehicle use and not be seen as an inconvenience of last
resort.

Thus we are clear that the economics behind a public
transport system is it provides commuters with an efficient, reliable,
affordable, comfortable and safe mode of transport at a subsidised
price.

It does not mean that public transport companies should
operate at a loss. It means they should operate and be able to sustain the
system and make a profit, which we might want to term a
surplus.

We all know that the transport sector either private or
public is an integral sector of any given economy. Indirectly it adds value
and provides a service to people.

As a result, it needs proper
developing, planning, strategising and implementation in order to deliver
good service.

Once again the idea is a noble one besides the fact
that it's a duplication of the already existing Zupco.

It has
its merits and the competition it will give to Zupco is healthy. My worry
though is the economic sense in how they want to operate the
company.

There is no proper public transport planning and
strategies for the long-run of these companies.

Has Gono taken
his time to look at why after we inherited Zupco then known as the United
Omnibus Company from the Rhodesian government, Zupco has failed to provide a
reliable service and operate efficiently?

Zupco used to have the
largest fleet in the country in the 80's and early 90's providing a service
to both urban and rural areas, but look at it now.

Is Gono not
just creating another Zupco with a different name but putting the burden on
the tax payer who will have to fund the project?

Transport is a
very tricky industry. With fuel and oils constituting 33% of running costs,
it makes it a delicate business to venture into especially if that is not
your core business and the fact that we import fuel makes it a risky line
not to talk of the spare parts and other related costs.

Operations and productivity of the transport sector make it as difficult
like any other service industry to manage.

Marginal revenue has
such an impact on the marginal costs, thus with every additional revenue
your running costs are reduced.

In layman's terms this is with
every additional bus you operate, giving additional revenue, your operating
cost is reduced and thus you can reduce your fares.

This is
assuming everything is normal and stable. Numbers in the fleet play an
important part in reducing operating costs, both fixed and variable. With
say 10 buses per city or province and charging 70% of what Zupco is charging
now, the company will do well.

Zupco is currently in trouble
because their fares are way too low. The company cannot break even on that.
Zupco claims it has made profits, which is not true, because they have
failed to buy spare parts.

Most of their buses are off the
road.This is because of their costing and replacement value of the fleet,
which they failed to take into account when costing for fares per
kilometre.

I am not deliberating on Zupco, but about the rationale
of the RBZ setting up a public transport company as its subsidiary. By
setting up this new company, the RBZ is in fact admitting that Zupco has
failed to deliver a transport service to the public.

Has the
RBZ taken time to look at Zupco's mistakes?

They should then use
that expertise to help rescusitate Zupco.

There is no need to form
another public transport company at this juncture. Instead, expertise and
resources should be channelled into Zupco. Take note of the
following:

*Identify and investigate problems the company had in
relation to strategy, policy, markets, and organisational structure,
management style.

No End In Sight As Cash Queues Lengthen

Thursday, 02 October 2008
20:48THE scene outside banks does not inspire confidence. Depositors
have this week been pushing and shoving in dense queues outside banking
halls in a bid to withdraw cash.

If there is no queue
at a bank it is probably because bank staff have advised their clients that
they were not expecting cash that day from the Reserve Bank.

For banks such as Barclays, CABS, Beverley and FBC Building Society their
banking halls have been virtually clogged with people since Monday.

"It will probably take three weeks to clear queues at banks following the
latest cash withdrawal limit review, but once prices respond to the limit,
the queues will resurface and will become much longer," a commercial bank
executive said.

"What is urgently needed is to increase production
to contain inflation to reduce demand for cash. Cash reviews are just
stopgap measures in a hyperinflationary environment."

There has
been increased demand for cash of late because shops are refusing both
personal and bank cheques and overprice goods when one pays using the real
time gross settlement (RTGS) system or an ATM card.

Economic
analysts this week blamed the business community for contributing to cash
shortages as they were demanding hard cash for transactions that should
ordinarily be settled by cheque.

"Business has demonetised cheques
as a form of payment. It's the manifestation of rising inflation which has
not been supported by production," an economist who asked for anonymity
said.

"Uncertainty over the cost of the same goods the following
day is forcing most outlets to reject cheques."

The economist
said some businesses preferred to be paid through the RTGS system because
their charges were "ridiculously high".

Bankers Association of
Zimbabwe president John Mangudya said many banks had long queues probably
because of the transitional period that took place on Monday morning when
the Reserve Bank was distributing new notes to the banks.

"I am
sure that the situation will improve. Whenever there is a maximum cash
review queues become longer," said Mangudya.

Reserve Bank governor
Gideon Gono also assured the nation that the cash situation would improve
significantly over the next few days as demand progressively eases while
efforts to tame the challenge have been stepped up.

"We were
never under a misconception neither did we expect that the backlog in the
demand for cash would be cleared in one day, as there is naturally a
physical and logistical limit to what can be achieved in one day by the
cash-dispensing banks," Gono said.

"With the best will in the
world, it is just impossible for the banks to satisfy all their clients in
one day. What is certain though is that we expect the banks to have cleared
all queues by mid to end of next week."

The situation on the ground
however seems to suggest the opposite and the public expected Gono to
explain how foreign currency dealers had got bags of the new $20 000 and $10
000 notes by Monday morning before most banks had received their
allocations.

The Reserve Bank has in the past attributed the
massive shortages of cash to the accumulation and hoarding of money by those
dubbed "cash barons".

The cash barons comprised, in the main,
those engaged in the unlawful purchase of foreign currencies, either in
order to externalise assets, or to fund imports, and others engaged in
cross-border trading operations.

Other cash barons were retailers
who found that they could realise substantial profits by not banking their
sales receipts, but instead accumulating the cash to sell it at a premium to
those in desperate need.

Economist Eric Bloch recently said the
root cause of cash shortages was the rampantly spiralling
hyperinflation.

"A consumer required over 300 times as much money
to buy exactly the same goods, in exactly the same quantity, as he or she
needed to have only one year earlier," said Bloch.

"Extrapolate
that increased currency need by several million purchasing consumers, and
the total cash needed by that buying population exceeds all currency in
circulation."

He added: "Admittedly, some customers pay for their
purchases by cheques, or with credit cards, but the masses of the low-income
earners and those who reside in rural areas cannot access or afford banking
facilities.

"Therefore, it must be realistically assumed that at
least a half, if not more, of the total currency that was in circulation
was, at any time, in people's wallets, purses, handbags, pockets, or homes,
solely in order to fund ordinary consumer needs."

He said the
most virile part of the Zimbabwean economy is the informal sector. With
unemployment being endemic, the majority of the population has little or no
alternative but to resort to foreign currency deals.

The magnitude
of the money held by the general public, for no untoward reasons, and by
informal sector operators, would undoubtedly have considerably exceeded the
sums held by banks, as people have lost confidence in banks as prices of
basic goods and services continue to increase.

Independent
economist John Robertson said: "The Reserve Bank is fighting a losing
battle. As long as the inflation remains high, cash shortages will persist.
There is need to address the inflation by increasing production so that too
few goods do not (cost) a lot of money."

Most banks on Monday
struggled to meet depositors' demands for cash withdrawals, while foreign
currency dealers had the new notes.

Only FBC Bank, Stanbic Bank,
Kingdom Bank and Standard Chartered Bank had the new notes by Monday
morning.

Other banks either started issuing the new notes after
lunch or on Tuesday.

Economist and investment analyst Lance
Mambondiani said the cash crisis needed urgent reforms that promote
production to ensure goods are readily available on the formal
market.

"All this is a result of high inflation. When the country
is indebted to the extent of 100% of gross domestic product, and 90% of the
tax revenues going towards debt servicing, the current fiscal policy
measures will have to be restructured," Mambondiani said.

He
said to achieve that, the country needed to increase domestic savings, carry
out pragmatic tax reforms, turn around state enterprises towards
profitability, boost agricultural productivity, revive industry and promote
austerity measures.

"Pervasive corruption within the civil sector
should be an important focus in arresting state leakages and improving
investor confidence," he said.

He said these measures should
provide a framework on which a substantive economic recovery plan can be
constructed to arrest inflation.

"The implementation of the
economic recovery plan will not be without its challenges. Some sectors of
the international community have already raised concern that the architects
of the economic implosion are still in their positions.

"As a
result, neither generosity nor austerity will be delivered as
enthusiastically as might have been a fresh start," said
Mambondiani.

MDC deputy treasurer-general Elton Mangoma this week
said the long queues at banks were an indictment of government
policies.

"The repercussions of keeping people's money in banks
while inflation erodes value are far greater than simply increasing the
daily limit," Mangoma said in a statement.

"The restrictions on
daily maximum withdrawals have spawned corruption, crime and petty theft as
people resort to other means of raising a quick buck to sustain their
families."

He said with the critical humanitarian situation in the
country people needed money to feed their families."Even the
Bacossi programme has dismally failed to address the massive starvation that
has swept across the country. It has failed because people need more than
just cooking oil, beans, soap and mealie meal which are covered by this
programme. They need to pay school fees for their children," Mangoma
said.

He suggested that the Reserve Bank regulations to allow
selected shops and wholesalers to sell goods in foreign currency will cause
more havoc in an economy already teetering on the brink of
collapse.

"It is unclear where ordinary Zimbabweans will be
expected to access the foreign currency to buy these goods without resorting
to the parallel market.

"It is also unclear how a majority
population getting its salary in local currency will be expected to take
advantage of these shops," said Mangoma.

Mangoma said the MDC
hoped Zanu PF would move away from its intransigent position on the
distribution of key ministries so that a new government begins to address
the people's basic needs.

Erich Bloch: Parastatal Privatisation

Thursday, 02 October 2008
19:25WITH an allegedly "unified" government hopefully becoming
functional shortly, Zimbabweans and the world at large have an increasingly
great expectation of major policy changes to bring about an economic
recovery, gravely needed and very long overdue.

In the
unity accord signed by Zanu-PF and the two MDC formations, a few weeks ago,
the three parties agreed "to give priority to the restoration of economic
stability and growth in Zimbabwe", and recognised that the "unity"
government would necessarily have to "lead the process of developing and
implementing an economic recovery strategy and plan".

They
emphasised their recognition of the role that would have to be played by
government in achieving an economic transformation by committing themselves,
within the signed agreement, "to working together on a full and
comprehensive economic programme to resuscitate Zimbabwe's economy, which
will urgently address the issues of production, food security, poverty and
unemployment, and the challenges of high inflation, interest rates and the
exchange rate."

Amongst the innumerable issues that must
necessarily be addressed, if economic recovery is to become a reality, is
the urgent rehabilitation and enhancement of much of the Zimbabwean
infrastructure as is required for effective economic activity. That
infrastructural rehabilitation and enhancement need relates especially (but
not exclusively) to energy generation and distribution, air, rail and road
transportation, water management and distribution, and telecommunications.
Zimbabwe's resources in these critical areas of supply of economic (and
sociological) essential needs are dismally debilitated and incapable of
servicing current national needs, let alone the considerably increased
requirements of a future growth economy.

The common
denominators between the diverse entities responsibilities for the energy,
water, transportation and telecommunications service and supply in Zimbabwe
are that, save for two providers of cellular telephone services, all such
entities are wholly owned by the State. All those enterprises are
parastatals, none of them are meeting the present needs of Zimbabwe, their
infrastructures are aged, operationally grossly inadequate, subject to
horrendously frequent breakdowns, and far behind the technological advances
achieved and used in most other countries.

Many of those common
denominators are by-products of others, foremost of which are that all of
the parastatals would, if they were private sector enterprises, verge upon
the criminal, with frequent incurring of debt without reasonable
expectations of servicing debt. That under-capitalisation, compounded by
lack of foreign exchange, hinders infrastructural upgrades, let alone
timeous and effective maintenance, repair and refurbishment. The parastatals
are also afflicted by ongoing losses of skills (in common with most other
economic sectors), and an almost total inability to replace the lost skills,
resulting in a continuously increasing lack of requisite technological
resources.

Yet another of the very major retardants of the
operations of the parastatals is that their managements are not accorded the
degree of decision-making autonomy and independence necessary for effective
business administration, control and development. Instead, pen-pushing civil
servants set upon empire building and preservation unduly intervene and
impose decisions upon managements. This is exacerbated by the extent that
government in general, and some ministers in particular, have over the years
utilised their authority over parastatals to progress governmental political
objectives or self-centred materialisation.

Admittedly, this
sad state of affairs has in no manner been unique to Zimbabwe, but is in
common with not only prevailing conditions in various other countries (and
especially those operating as quasi-dictatorships), but also was the case in
the past in numerous first-world, developed economies.

Almost
without exception, those countries as have successfully resolved the
ill-effects upon their economies, did so by partial or total privatisation
of those parastatals.

Such privatisations were very successfully
effected in France ( inclusive of its automotive industries, rail
transformation and telecommunications), in the US over more than 70 years
(inclusive of immensely successful privatisation of media services,
telecommunications, rail transportation, energy generation, and much else)
and, with a few exceptions, in the United Kingdom, where the most pronounced
successes were in telecommunications, provision of utilities, and certain
rail, air and road transportation services.

For almost 17 years
Zimbabwe has talked of privatisation, including such intended action having
been one of the planks of the Economic Structural Adjustment Programme
(Esap) of 1991, and the establishment of a Privatisation Agency in the late
1990s. Regrettably, to a very major extent, the only action has been talk,
rather than action of substance. There have been a few very notable
exceptions, and the successes of those exceptions should be added motivants
to government vigorously to pursue privatization.

The privatisation
of Cotton Company of Zimbabwe, Zimbabwe Reinsurance Corporation (Zimre), and
Dairibord Zimbabwe Ltd, as well as government's partial disinvestment from
some of its banking interests (ZB Bank and CBZ Bank), evidence the merits of
privatisation, whilst the failure of most existing parastatals to service
national needs is in sharp contrast to those privatisation successes.
Amongst the many that urgently need privatisation, wholly or partially (but
then at least substantially) are Zesa, Zinwa, TelOne, NRZ and Air
Zimbabwe.

If such privatisation would be on the basis of partial
disposal of equity to international strategic partners, partial disposal by
equity listing on the Zimbabwe Stock Exchange, and partial disposal to
management and employees of the enterprises, the entities would access much
needed capital, state-of-the-art technological inputs, new operational
equipment compatible with, and enhancing of, existing equipment resources,
and skilled personnel, whilst markedly improving prospects of retaining the
services of such competent management and staff as may still be in the
employ of parastatals.

Concurrently, government would be
relieved of very considerable direct, and indirect debt, and in some
instances would even benefit from fiscal inflow in exchange for its
divestment from the parastatals, thereby providing greatly needed funding to
reduce, to some extent, government's gargantuan deficits.

In
addition, in some instances, Zimbabwe would also benefit from some foreign
exchange inflows, which are very greatly needed.

The time is now
for government to discard the prolonged dislike of parastatal privatisation
(despite many pretences to the contrary), and intensively, rapidly and
effectively to pursue such privatisation, which is very long
overdue.

Editor's Memo: Tsvangirai, Mugabe Should Work Together

Thursday, 02
October 2008 19:17IF the current power-sharing deal does not collapse
due to the simmering political clashes between the parties to it, President
Robert Mugabe and incoming Prime Minister Morgan Tsvangirai would need to
find common ground and agree to a collective reconstruction
agenda.

So far there is no good reason to believe the two
have a common national agenda on anything other than threadbare
protestations of unity on the basis of an otherwise profoundly-flawed
agreement that leaves Mugabe firmly in charge as head of state and
government.

Mugabe is also chairman of cabinet and
commander-in-chief of the defence forces. He is further chair of the
National Security Council (currently known as Joint Operations Command) and
will be the final authority on everything which matters in government. The
need for him to consult or sound out Tsvangirai before making appointments
is just a silver lining in a dark cloud.

Tsvangirai, as deputy
chairman of cabinet and chair of the Council of Ministers, is undoubtedly a
junior partner to Mugabe. Through irresistible pressure and deceit he was
given a shell of a premier's mantle or a false impression of power, while
Mugabe retained the substance of it by means fair and foul.

Tsvangirai will have to manoeuvre in the limited operational space and if he
is buccaneering and dynamic enough he may seize control and be
influential.

This may anger a lot of people who appreciate that
Mugabe has no chance of beating Tsvangirai in a free and fair election. But
this is the reality. For the sceptical let's wait until push comes to shove
as it inevitably will. It's just a matter of time.

Some may try
to sugar-coat the power-sharing agreement by interpreting it in a different
way or clutch at straws. That's fine, but in the end it is clear that Mugabe
remains in control of the levers of power. This was not surprising at all
considering the gross imbalance in power relations between Zanu PF and the
MDC, but the ultimate disequilibrium is rather too
disproportionate.

However, if the deal holds Mugabe and
Tsvangirai need to develop a serious and common reconstruction agenda to
rescue the troubled country and move it forward.

A recent paper
by the Centre for International Private Enterprise (CIPE), a non-profit
affiliate of the US Chamber of Commerce and one of the four core institutes
of the National Endowment for Democracy, states clearly what needs to be
done in a post-conflict society like Zimbabwe.

In post-conflict
societies, reconstruction efforts must focus on rebuilding and strengthening
institutions in addition to providing humanitarian aid and basic
infrastructure. It says:

"The private sector plays a crucial role
in advancing reconstruction and establishing credible institutions in
post-conflict societies.

"Institutional and economic reforms must
be carried out at the grassroots level in order to cultivate a sense of
responsibility within local communities and to engage the local private
sector and civil society in meeting specific development needs of
post-conflict countries.

"Post-conflict reconstruction is a
challenging process for any nation recovering from protracted violence, and
is often looked at with a dose of criticism and scepticism. It is especially
difficult when early hopes for better livelihoods, economic prosperity, and
conflict resolution meet the realities of political battles, ethnic
disputes, misguided policies, social disorder, and quarrels over key
resources.

"Still, post-conflict reconstruction can also be a time
for hope. As reconstruction efforts mount, a unique window of opportunity
for reforms opens up as domestic decision-makers, business leaders, social
actors, and international donors come together in an attempt to create a
more positive future for the citizens of a country emerging from conflict.
Seizing this opportunity to implement real reforms is one of the greatest
challenges facing all actors involved in reconstruction
processes.

"Experience suggests one way to approach the complex
challenges of post-conflict reconstruction is to view the process as a
balancing act of providing sufficient humanitarian relief without
compromising longer-term development objectives. These longer-term
objectives include developing institutions -- not government agencies, but
political, economic, and social structures and mechanisms -- that allow free
market democracies to take root.

"The term "reconstruction" as
applied to post-conflict countries can be somewhat misleading. It is often
narrowly understood to mean the restoration of physical infrastructure:
rebuilding houses, roads, bridges, factories, etc. In fact, these projects
are often showcased in public coverage of reconstruction efforts, as they
are easy to grasp and visualise -- one can see a new building where it
wasn't before, a government office with brand new computers on once-empty
desks, or a functioning public utility system that lay in ruins just a year
earlier.

"Although this physical element of reconstruction is
undoubtedly important, experience shows it is not sufficient for the
sustained, long-term political and socio-economic development of societies
emerging from conflict."

Equal attention should be paid to the
reconstruction - and in many cases building from scratch - of institutions
that underlie functioning market economies and democracies. Institutions are
social, economic, and political structures that guide human behaviour. These
may be laws and regulations, as well as informal rules of human cooperation,
a vibrant civil society, or independent media.

Post-conflict
reconstruction must provide sufficient humanitarian relief and physical
infrastructure without neglecting longer-term development objectives that
can only be achieved through institutional reforms.

Muckraker: Zanu PF Needs A Gag

Thursday, 02 October 2008 19:08
IT was interesting to note President Mugabe's warning in his airport speech
on Monday that: "We should never tolerate interference in the domestic
affairs of our country."

"We will be very strict," he said.
"No outsiders will be allowed to follow parties and politics. Any country
which does that declares itself an enemy of Zimbabwe," he said.

Here is a function of the new cabinet that has already been usurped. It is
up to the new government to decide on who can monitor Zimbabwe's political
process and who can't, not Mugabe. Indeed, it will eventually be the
responsibility of an independent electoral commission.

The whole
point of the political accord signed on September 15 was to remove Mugabe
from the day-to-day decision-making process so he doesn't inflict any
further damage on the country.

The people of Zimbabwe have made it
clear they want help from the outside world in reconstruction of the
economy, including help from countries Mugabe calls "enemies".

These are the very same people now being called upon to dig Zimbabwe out of
the hole Zanu PF has dug for us. Certainly the Russians and Chinese won't be
rushing to assist!

The fossilised language of ideological combat
continues to occupy the pages of the state media where columnists are
conducting a private war against the West. That is why there has been no
great rush by the outside world to embrace the new order.

The
first item of cabinet business once the new government has been formed
should be to apply a gag to Zanu PF spokesmen so they don't scare off any
more potential rescuers.

Help ease water blues," Zinwa has
called upon the public to do. It wants to see community-based
decentralisation of waste water by setting up small waste water treatment
units. This would include schools, housing cooperatives, and industries,
among others.

"Our aim is to advise stakeholders of the
considerable water recycling economic value and then engage them on how to
tap the value," waste water manager, Engineer Simon Muserere, was quoted as
saying.

What a cheek! Zinwa doesn't need to advise the public of
anything.

It needs to focus on its core business of supplying clean
water to the people of Zimbabwe. Muserere should stop trying to divert our
attention with schemes of this sort. We all recall how this useless outfit
was placed in charge of municipal water systems that worked much better than
they do now. Why were public objections by civil society such as the
Bulawayo council ignored?

Then there is the torrent of water
that has been cascading down East Road by the Trauma Centre for several
months. Why can't Zinwa fix that simple fault?

Muserere needs
to be reminded that under the new political order wasteful and incompetent
parastatals will not be tolerated. That includes smoke-and-mirror publicity
stunts in the Herald.

Muckraker was intrigued by a report in
Monday's Herald that deputy Health minister Edwin Muguti's official vehicle
had been used in a spate of armed robberies. These included raids on gold
mines and foreign exchange dealers. On several occasions, the driver,
Rodwell Dube, removed registration plates and replaced them with fake
ones.

In addition to Muguti's Toyota Prado he used a Mazda
belonging to the Health ministry.

His activities culminated in
a shootout with detectives in the city centre, we are told.

Detectives said Dube was part of the gang involved in the shootout with
police at Eastgate shops last week. Among the gang is an ex-police sergeant
dismissed from the force for stock theft. He was out on bail pending appeal
against a six-month sentence.

What is missing in this story is any
reference to the deputy minister. Was he not interviewed regarding the
activities of his driver and the abuse of his official vehicle? Was he not
aware of the vehicle's frequent absence? Why didn't the Herald tell
us?

Here was public property being abused by a driver whose
delinquency appears to have been overlooked. We don't understand how Muguti
missed what was going on right under his nose?

Ephraim Masawi's
Prado was the subject of police investigations this week and for exactly the
same reasons.

Ministers have a responsibility to safeguard public
property assigned to them. How many other officials have allowed vehicles in
their care to be diverted to other uses?

Our hearts went
out to the tens of thousands of people who tried to obtain $20 000 cash from
banks this week. There was very simply no money. Sidewalks along Samora
Machel Ave were packed with disappointed customers.

So why didn't
the Reserve Bank anticipate this humanitarian disaster before it happened?
Did it not liaise with banks as to the availability of funds?

It is painful to watch Gideon Gono being clever with words in his public
pronouncements and then seeing ordinary Zimbabweans paying the price of his
"cleverness". It is very obviously time for the Reserve Bank governor to
step aside and allow somebody else to do this job.

It was very
helpful of the Herald to bring us a picture of President Mugabe addressing
the 63rd session of the UN General Assembly. Who could miss those rows of
empty seats?

Perhaps that's because everybody had heard his speech
before. The Security Council, he said, was undemocratic because it was
subject to manipulation by powerful nations. He called for
reform.

That is something he has refused so far to give the people
of his own country. And just as the president was speaking, Russia voted
with Britain, France and the US to reinforce sanctions against Iran. That
must have caused some irritation in the Zimbabwe camp!

All in
all it wasn't a very fruitful visit for Mugabe. We wonder what use those
other 53 people in his entourage made of their visas, apart of course from
shopping.

We revealed last week that the US embassy said it had
issued 54 visas including for the wife and son. Oh yes, a hairdresser went
along too we hear in case the Iron Mask needed attention.

Information minister Sikhanyiso Ndlovu this week "hailed" the public media
for its "professional coverage" of events during and after the inter-party
negotiations.

The public media also "excelled" in its reporting of
the president's speech at the UN General Assembly, he said.

This provided some mirth in newsrooms around the country. Exactly how can
you "excel" in reporting a speech by the president that was foisted on the
media accompanying him? And what is "professional" about denying to other
parties the right of reply to vituperative partisan opinion pieces carried
in the Herald and Sunday Mail?

To date we haven't seen a single
article responding to the antediluvian posturing of Tafataona Mahoso who
needs a few lessons in what makes journalism not simply professional but
interesting!

We suspect Ndlovu's daft remarks were designed to
attract attention ahead of the cabinet appointments. Let's see how far they
get him.

It's always good when someone in public life admits
they've been wrong...or even slightly wrong.

When Zimbabwe
Tourism Authority chief executive Karikoga Kaseke announced, apparently
unilaterally, to a stunned local hospitality industry, that this year's
tourism expo - dubbed Sanganai/Hlanganai World Travel and Tourism Africa
Fair - would move to Bulawayo on the grounds that space was limited at
Harare's Rainbow Towers, many if not most of the country's old tourism hands
shook their heads in collective amazement.

Kaseke said the show
would be held at the under-utilised Zimbabwe International Trade Fair
grounds, Famona, miles from anywhere resembling a hotel.

Harare's space wasn't cramped at all, the experts said, but if that later
proved the case, there was almost limitless exhibition square metres lying
empty 51 weeks annually within walking, if not spitting, distance of the
expo's traditional Rainbow Towers home at Harare showgrounds.

Put
all two, three and four-star rooms available spread out across the sprawling
City of Kings and they don't equal the number of beds available at Rainbow
Towers itself.

Harare also has Meikles Hotel, Crowne Plaza
Monomatapa, Cresta Jameson, Oasis, Harare Holiday Inn and countless suburban
lodges, guest houses and b&bs. Most international visitors will fly into
and return home from the capital.

Now Kaseke has told the
Herald there is need to put in place a "mitigation plan" (Plan "B" to you
and me!) because of "accommodation challenges Bulawayo was facing!" (Sound
familiar?)

He told the state-controlled paper: "Definitely some
people will have to stay in Harare and Victoria Falls, then fly to Bulawayo,
because the accommodation is not enough.

"All hotels were
booked for these celebrations and Sanganai will be 20 times bigger," he
said, without revealing what, precisely, was previously 20 times
smaller.

e have news for the irascible, short-tempered "KK"
(the only man in the world ever charged with cruelty to crocodiles!). Planes
from Vic Falls arrive in Bulawayo at sunset but there's no room at the
inn/hotel/lodge, the Bulawayo Club, Hotel School, Solusi University or even
the lodges in the Matopos park for anyone who alights there!

Kaseke truly is an amazing chap. Apart from reportedly putting the elbow on
Bulawayo hotel managers to release "freebie" rooms to his cronies for
Sanganai (when they haven't got sufficient beds to sell), he raised eyebrows
by boycotting last year's Zimbabwe Council for Tourism AGM at Nyanga to
squire around a dreadlocked Rasta rapper and booked in Miss Tourism Zimbabwe
and her princesses at the Monomatapa for several cripplingly expensive
months. (They'd probably be still there if the press hadn't blown the
whistle.)

Last Friday, when almost the whole of the Zimbabwe
hospitality industry was en fete for the gala birthday thrash of Cresta
Jameson Hotel, he and 11 praise singers took themselves off to Nyanga to
"join the rest of the world in commemorating World Tourism
Day".

Of course they commemorated it by wheedling freebie rooms,
food and drink out of unfortunate Eastern District hoteliers.

Kaseke was thankfully absent at the previous week's Meikles Hotel AZTA
awards spring brunch on the roof garden. When Muckraker's apprentice queried
the non-attendance of the usually glowering functionary, he was left in no
doubt "KK" wasn't invited.

It will be interesting to see which
political party gets "tourism" in the eagerly awaited Cabinet portfolio
carve-up.

olice Commissioner-General Augustine Chihuri says
Zimbabweans should put aside their differences and work together. All
sober-minded people welcomed the latest developments, he said.

Chihuri said the economic challenges facing the country "were not of the
making of the leadership, but of foreigners who wanted to enjoy the benefit
from the country's resources".

If foreigners want to benefit from
the country's resources they will need to see a stable political situation
and sound macro-economic fundamentals in place. They will also need to know
that there is a professional police force that is non-partisan in the
fulfilment of its duties. That must be an immediate objective of any new
government.

The Sadc initiative was spurred in part by pictures
circulated at Dar es Salaam of MDC leaders brutally assaulted at a police
station. We are yet to learn what action hasbeen taken against
those responsible.

As for the economic "challenges" facing the
country, there needs to be complete honesty in facing them. If we persist
with the official deceit that foreigners are responsible for Zimbabwe's
self-made mess there will be no change and no improvement. That needs to be
spelt out in large letters for the regime's apologists.

nd
now on a lighter note, we bring you this newsflash. Following the problems
in the sub-prime lending market in the US and the run on Northern Rock in
the UK, uncertainty has now hit Japan.

In the last seven days
Origami Bank has folded, Sumo Bank has gone belly up and Bonsai Bank
announced plans to cut some of its branches.

Yesterday, it was
announced that Karaoke Bank is up for sale and will likely go for a song,
while shares in Kamikaze Bank were suspended after they
nose-dived.

While Samurai Bank is soldiering on following sharp
cutbacks, Ninja Bank is reported to have taken a hit, but they remain in the
black.

Furthermore, 500 staff at Karate Bank got the chop and
analysts report that there is something fishy going on at Sushi Bank where
it is feared that staff may get a raw deal.

Comment: Gono's Complex Mind

Thursday, 02 October 2008 18:50
RESERVE Bank governor Gideon Gono is reported to have said he is ready to
leave office if anyone wants his job.

He disclosed this at
a field day at Chief Fortune Charumbira's Acton Farm in
Masvingo.

"I am even looking for an excuse, I do not need much
effort to be pushed out," he said. "If anyone wants to take my job, let them
come forward."

This should have been music to the ears of those
Zimbabweans who this week spent hours in queues waiting for cash at banks
after the withdrawal threshold was raised to $20 000 on Monday. While Gono
has invited those who want his job to come forward because he is ready to
leave with the least of bidding, it does appear that in reality he has
become immune to growing exhortations to quit. He should have been among the
throngs outside banks this week to hear who the public hold responsible for
the mess.

No one wants his job because it is tantamount to
receiving a poisoned chalice, which we warned him about when he took office
in December 2003. But depositors, many sleeping in the queues, believe that
he is the root cause of their misery.

Those who have followed
his performance as Reserve Bank governor since his appointment in 2003 have
their daggers drawn but appear reluctant to tackle the formidable foe. Gono
is digging in and is not acting like a man going anywhere soon.

He came into office vowing to clean up the banking sector in which many
banks had forgotten their core business and were risking investors' money in
speculative investments. Despite accusations that Gono used a sledgehammer
to swat a fly, including being vindictive in his handling of certain
financial institutions, at least he managed to restore some semblance of
order.

But the chaos manifesting itself in the cash crunch at
Christmas appears to be returning once again. Gono also came into office
promising to fight inflation, which he declared to be the country's Number 1
enemy. He famously declared that "failure was not an option" in that war. He
was also sold to the nation as a most able turnaround strategist after the
almost miraculous resurrection of the then Commercial Bank of Zimbabwe where
he was chief executive officer.

At the time of his declaration
of war the inflation rate was 621%. Today at 11,2 million percent people
have stopped looking for adjectives to describe it, except as another world
record for Zimbabwe!

Gono has said we are living under
extraordinary conditions and it is therefore not a time for textbook
economics when rebutting those who tell him it is ill-advised to print money
to meet excessive government spending or that he is straying from the core
business of the central bank by engaging in quasi-fiscal
activities.

In his speech in Masvingo this week, Gono let us into a
bit of the complex operations of his mind. Sounding like he had just dropped
in from Mars to see for himself what has been rumoured as Zimbabwe's
economic collapse for nearly a decade, Gono remarked: "Zimbabwe's ancestors
are strong. It is surprising to see our economy standing by
now."

Then apparently angry that the economy was still "standing",
Gono said he would continue to print money, maybe to spite those who believe
his policies have failed and that he should call it quits.

"I'm
not afraid to print money and I will continue doing so until those who
imposed sanctions on us (the West) have lifted them," Gono said.

No
doubt even his most ardent supporters must have cringed at this. It is
difficult to see how a Reserve Bank governor who continues to print money
and then thanks the "ancestors" for saving the economy can win the war
against inflation, let alone achieve an economic turnaround.

The least anyone would have expected of Gono was for him to repeat the Zanu
PF rhetoric about sanctions and the need to fund agricultural recovery under
a cash economy.

The Zimbabwean economy is still standing not
because but despite disastrous printing of money. The Zimbabwean economy is
still standing not because of "strong ancestors" but because a strong
foundation had been laid long back to withstand the most brutal buffeting by
the storms of President Mugabe's unplanned and badly executed land reform
programme.

It is that foundation of the economy, commercial
agriculture, which needs to be rebuilt before Zimbabwe can reassert its role
as the regional breadbasket. So far Gono's efforts to reduce inflation and
achieve an economic turnaround have failed because he has been tinkering
with the symptoms and forbidden by his "principals" to address the
macro-economic fundamentals.

People expect Gono to be telling
them that the madness of the past few years is finally coming to an end. He
should be preparing to cede the vast powers and a myriad other
responsibilities the central bank acquired during the years of madness to a
properly constituted government. The least that this nation expects at the
moment is Gono promising us more of the same.

Candid Comment: Mugabe Quiz: Democracy Or Demoniac?

Thursday, 02
October 2008 18:46PRESIDENT Mugabe has denied a "deadlock" in the
sharing of portfolios under an inclusive government with the two MDC
formations.

The MDC led by Morgan Tsvangirai has objected
to what it says are attempts to treat it as "a junior" partner. There is
clearly a problem, whatever its name.

Part of that problem is
Mugabe's uneasiness with democracy which he feels threatens to destabilise
established order. More specifically, democracy should not threaten those in
power. To him, when not properly guided, people are prone to stray in the
name of democracy.

That is what nearly happened on March 29. They
needed to be reoriented, as happened on June 27. Democracy, he thus reasons,
doesn't mean that people should be left alone to do as they please because
they are apt to misinterpret their own interests.

That explains
why the inclusive government with the MDC is having such a prolonged birth.
He sees it as a plot to trim his personal authority by sharing it. It's
doubly unfortunate that he must share it with the man for whom he has
abiding contempt, especially because of the MDC's origins and funding. In
that context, for President Mugabe the role of the opposition is simple --
to oppose, never to rule.

He made his views clear on the day he
signed the power-sharing deal on September 15. Speaking off the cuff, he
pointed out that "democracy in Africa is a difficult proposition". These
might be his long-held views, but they are not helped by arrogant Western
donor nations when they openly declare what they want to see done and whom
they want as president. They give people like Mugabe a credible alibi when
they complain about a breach of the United Nations Charter on national
sovereignty.

There is another angle to this animal called democracy
which makes Mugabe particularly uncomfortable. There was South Africa last
week with its model constitution allowing a rowdy mob to run riot and unseat
an elected president.

Mugabe commented that South Africans were
free to make their choice. It was as if he hadn't grasped fully that the man
who had just been deposed had played such a decisive role, not only in
defending Mugabe at his own expense, but also protecting Zimbabwe from a
questionable new regime of sanctions. He may not always agree with Mugabe's
policies but Thabo Mbeki understands better than any leader in the region
the centrality of land in Zimbabwe's crisis. New president Kgalema Motlanthe
shares this understanding.

It took some sombre reflection away
in New York for Mugabe to pour out his grief over Mbeki's dramatic departure
as president of South Africa. Democracy turned out to be such a heartless
monster. "There is a man who has been in the seat for so many years as the
father of the African National Congress and democracy in one stroke pulls
him down," lamented Mugabe. "Democracy without morality is no democracy for
all."

It is not simply the anguished reflection of one who has lost
a pal dealt a cruel blow by mob rule; Mbeki stands as a counterfoil to what
nearly happened to him on March 29. Here was a Mbeki high and mighty and
triumphant in Zimbabwe today; and then ruthlessly brought down the following
day back in South Africa!

Mugabe had praised Mbeki for his
mediation in the talks. He said it was necessary to allow him time to rest
before recalling him should there be a need. It has turned out to be a
momentous valediction. They will never meet again on equal terms. There may
not be a replacement for Mbeki who has the same fortitude to resist
pressures to do "something" about Mugabe.

But the terror of what
had just occurred to Mbeki went deeper. It exposed democracy as lacking
"morality" if those who exercised it did not have respect for age, a
person's past contribution and the length of a leader's tenure of
office.

Here was the nub.

Mbeki has been in the ANC
for 52 years. He served in the presidency (first as deputy to Nelson
Mandela) for just under 15 years and his term of office would have ended in
April next year. Mugabe has been at the helm of Zanu PF for about 33 years.
He has been prime minister and president for a combined 28 years. This
misguided democracy could turn him into history overnight through the
ballot, without people thinking twice that "for so many years" he was the
father of Zanu PF and president of Zimbabwe!

What has happened to
Mbeki may turn out, at least in the short-term, to be a huge blow in the
fight for democracy in Zimbabwe, not just because of his reduced clout as a
mediator but by hardening Mugabe's attitude against those he views as
plotting a Mbeki on him. In any case Mbeki's mediation should have been over
with the signing of the power deal.

It is reprehensible immaturity
that our political leadership expects him to appoint a cabinet for Zimbabwe
by allocating ministerial portfolios to the three parties. The quarrel over
so-called key ministries of finance, home affairs, foreign affairs and local
government highlights the level of mistrust which Mbeki can do nothing to
remove.

The ministries are key only to the extent that each party
believes they can be used as tools to manipulate rivals and for retributive
purposes outside a legally constituted truth and reconciliation commission.
It shows utter bad faith. Once again our political leaders are failing to
give the nation a vision, and there are many forces crying for precisely
this outcome -- that the power-sharing deal collapses with Mbeki's
fall.